Stocks were lower, as the Dow and S&P 500 had their worst day since May 20. The defeat of House Majority Leader Eric Cantor dominated the headlines.
First, the scoreboard:
Dow: 16,843.88, -102.04, -0.6%
S&P 500: 1,943.89, -6.9, -0.35%
Nasdaq: 4,331.93, -6.1, -0.14%
And now top stories of the day:
- The day’s biggest story came from the political arena, as Republican House Majority Leader Eric Cantor last night lost his primary election in Virginia. Reports today said that Cantor will step down as House Majority Leader on July 31. Cantor was expected to hold a press conference at 4:30 pm ET. Cantor’s loss also sent shocks through Wall Street. Greg Valliere, Chief Political Strategist at Potomac Research Group, said that as a result of Cantor’s loss, “an ugly, market-rattling debt ceiling fight now looms in March of 2015.”
- Shares of jetmaker Boeing were the Dow’s biggest loser, falling more than 2%, as some investors expressed concern regarding the fate of the Export-Import Bank, which assists in financing foreign airlines to buy jets.
- The economic calendar in the U.S. was light. The only major data point from the U.S. was the Treasury’s latest report on the budget deficit, which showed the deficit narrowed to $US130 billion from $US138.7 billion a year ago. Expectations were for the budget deficit to come in at $US130.5 billion.
- The Mortgage Banker’s Association reported mortgage applications were up 10.3% over last week. Following the report, Bill Banfield, Vice President at Quicken Loans said, “The jump in applications shows folks are taking notice of rates near six-month lows. The jump in chase applications is especially good to see, as homeowners may finally be getting comfortable putting their home on the market with the level of inventory they see around them.”
- RadioShack shares fell another 5% today, adding to yesterday’s 10% loss following a disappointing earnings report, as Scott Tilghman, an analyst at B. Riley & Co., cut his price target on shares of the electronics retailer to $US0. Tilghman said he believes the odds of RadioShack filing for bankruptcy are now better than 50%.