Following the July 4th holiday and the strongest week of the year for the market, stocks slid with all the major averages posting losses.
Concerns from overseas, specifically the UK and Italy, weighed on stocks on Tuesday.
First, the scoreboard:
- Dow: 17,838.91, -110.46, (-0.62%)
- S&P 500: 2,088.32, -14.63, (-0.70%%)
- Nasdaq: 4,822.90, -39.67, (-0.82%)
- Hostess, the maker of the famed Twinkie, is going public. The troubled company, which has gone bankrupt in both 2009 and 2012, announced that it will go public through a deal with special purpose acquisition company Gores Holdings. The firm will have an initial enterprise value of $2.3 billion. In a somewhat convoluted transaction, the firm is not going through a traditional initial public offering, but instead being sold for $675 million by private equity firms Apollo Global Management and C. Dean Metropoulos & Company to Gores. Gores will then offer the shares through its holding company which is already publicly traded.
- Business investment fell more than expected in May. Both factory and durable goods order missed expectations in May, falling 1% and 2.3% according to the Commerce Department. Economists had expected only a 0.8% drop for factory orders. As noted by Morgan Stanley’s Ellen Zentner, the drop in durable good orders was particularly worrying since it is on track for a third straight quarterly drop of 2%. This has only happened twice outside of a recession, in 1951 and 1986.
- The Bank of England warned about the impact of Brexit. The UK’s central bank released its biannual report on the stability of the country’s economy and it was grim. “The current outlook for UK financial stability is challenging,” said the report. It highlighted economic challenged coming out of the UK’s vote to leave the European Union, including the diving pound and shaky financial markets. The BOE attempted to assuage fears by reiterating its commitment to inject up to £250 billion of liquidity into the markets.
- Everyone is worried about Italian banks. This story has been developing for a while, but concerns over the amount of bad debt on Italian banks balance sheets once again raised its ugly head as a rush of headlines fretted over the incredibly high percentage of non-performing loans.
- Netflix shares popped on news of a possible partnership with Comcast. A report from Recode’s Kara Swisher said that the streaming giant will be integrated into Comcast’s new set-top boxes, the X1. The voice-controlled box from Comcast, which has been compared to Apple’s Siri and Amazon’s Alexa, would allow those that purchase the X1 “seamless access” to the steaming content according to the report. Netflix’s stock popped as much as 3% on the news, but settled up around 1.4%.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.