U.S. Stocks Reverse Initial Gains, Turn Lower by Midday Trade
Amid volatile trading, U.S. stocks pared initial gains to turn lower by midday trade on Monday as initial euphoria over the resolution of Cypriot bailout crisis withered out.
Besides, holiday shortened trading week and profit booking ahead of the month end also stalled the rally, believes Brian Battle, vice president of trading at Performance Trust Capital Partners, according to Reuters.
At last check, the Dow Jones Industrial Average Index lost 0.31%; the NASDAQ Composite Index fell 0.25% while the S&P 500 Index inched down 0.16%.
In some corporate news, shares of Dell Inc. (NASDAQ: DELL) climbed about 2.8% by midday trade after beleaguered PC maker confirmed that it received buyout offers from Blackstone Group and billionaire investor Carl Icahn.
Shares of Facebook Inc. (NASDAQ: FB) edged down about 1.90% by midday trade on Monday after the U.S. regulators approved plan to compensate market makers who lost money during the social networking giant’s botched IPO, last May.
Shares of Apollo Group Inc. (NASDAQ: APOL) rallied after the for-profit education provider handed better-than-expected fiscal second quarter results and revenue.
European equities also sank deep in red territory as market participants believe that the bailout deal of Cyprus sets a bad precedent for future.
“Investors will once again be concerned over the security of their bank deposits,” wrote McCudden, head of derivatives at stockbroker Interactive Investor, according to CNBC-Reuters.
At last check, the Pan European Stoxx 600 Index edged down 0.41%, FTSE 100 fell 0.35% while Germany’s DAX lost0.57%.
Earlier today international lenders agreed to release financial assistance worth euro 10 billion to Cyprus after both parties stuck a last-minute deal, which required the island nation to restructure its overstretched banking sector and generate euro 4.2 billion from taxing unsecured deposits (over euro 100,000).