Stocks fell, but recovered some losses after opening deep in the red on uncertainty out of Europe.
First, the scoreboard:
- Dow: 16,915.07, -70.5, (-0.4%)
- S&P 500: 1,964.68, -8.2, (-0.4%)
- Nasdaq: 4,396.20, -22.8, (-0.5%)
And now, the top stories of the day:
1) This morning, weekly initial jobless claims fell to 304,000 from 315,000 a week ago. The report was also better than the 315,000 initial claims that was expected by economists. Following the report, Ian Shepherdson at Pantheon Macro said, “In one line: Looks great, but expect volatility over the next four weeks… Sooner or later — presumably next week — the auto shutdowns will hit the claims data, so we have to expect substantial neat-term volatility, though today’s report likely is reasonable reflection of the favourable underlying trend.”
2) The top stock story of the day was CYNK Technology, a $US5 billion social networking company that has no revenue, no assets, and just one employee. Shares of CYNK Technology, which trade over the counter, were up better than 25,000% since June 17, and after trading up as much as 30% today, closed down 5%, giving the company an end of day market cap of just over $US4 billion. The company operates a social networking site, IntroBiz.com, which connects members to celebrities, among other people, for free. Though seeing as the company has no revenue, it is unclear what the status of the business is.
3) This morning, stocks in Europe fell, bringing U.S. stock futures down with them, after the parent company of the second-largest bank in Portugal, Banco Espirito Santo, missed debt payments to “a few clients.” Following the news, Bloomberg economists David Powell and Maxime Sbaihi said, “Problems in Portugal’s banking sector appear to have worried investors over the solvency of the country.” Powell and Sbaihi also noted that the public finances of Portugal are among the most fragile in the eurozone. Additionally, both Bloomberg and The Wall Street Journal reported that Spanish bank Banco Popular Espanol postponed a planned debt sale citing, “adverse market conditions.”
4) Also in Europe, industrial production in France fell 3.7% year-over-year, a steeper decline than the 1% drop that was expected by economists. Following the report, Pantheon Macro’s Claus Vistesen said, “We are running out of downbeat adjectives to describe the data in France, with the headline numbers from the French industrial production report truly appalling.” Inflation data in France also disappointed, showing prices increased just 0.5% in June, less than the 0.7% increase in May and the 0.7% increase expected by economists.
5) Italy reported industrial production that fell 1.2% month-over-month in May, putting its economic recovery in doubt. Along with discouraging news out of the Spanish and Portuguese financial sectors, Italy’s poor results put renewed focus on the European periphery, which has seen a tepid recovery since the Eurozone crisis.
5) In U.S. corporate news, CNBC reported that Marcus Lemonis, the host of CNBC’s “The Profit,” is nearing a deal, along with a group of investors, to buy Crumbs Bake Shop. Shares of Crumbs, which shut its doors Monday, went absolutely bonkers following the news, gaining more than 1,100%.
6) Lumber Liquidators stock got crushed, falling 21% after the flooring company last night said customer traffic was weaker than expected. Lumber Liquidators became the latest in a series of U.S. corporations to report disappointing results, joining The Container Store and Family Dollar.
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