The S&P 500 ended lower by 1.2% after European concerns returned to the forefront. Equities began the day with a broad sell-off as a downbeat European trade weighed. Italian and Spanish indices were the source of the problem.
In Italy the MIB lost 4.5% as authorities continue to investigate several financials, including the world's oldest bank, Banca Monte dei Paschi di Siena. Today, five of eight banks listed on the Italian MIB experienced trading halts amid the sell off.
Meanwhile, Spain's IBEX fell 3.8% as 34 of 35 listings ended in the red. The markets were rattled as Prime Minister Mariano Rajoy and other members of the People's Party find themselves in the middle of an alleged kickback scheme uncovered by Spain's largest daily newspaper.
I find this comical and attribute the sell off to way overbought conditions, not only in Europe but here in the U.S. As I always say, the market always finds a reason to sell off, and today it was Europe, just like the good old days.
McGraw Hill (MHP-owns S&P) fell about 17%, as the Justice Department ( 5 years later) has decided to sue them for being horrible at what they do. Moodys (MCO) sold off in sympathy.
The S&P closed below its 10 day moving average today and may want to trade down to its 20 day moving average at 1484.50
The Nasdaq was down almost 2% as AAPL continues to beg for a bid anywhere. GOOG was also down about 17 points or about 2%.
So is this the start of something bigger or is this just the start of shallow and buyable correction? There is a lot of tax increase chatter starting up again. The market doesn't like taxes, so stay alert.