Photo: magician13134 via flickr
The funny thing is, it actually could have been worse today.But first, the scoreboard:
S&P 500: -22.31
And now, the top stories:
- Obviously the top story was the tumult in Greece. That actually started just after the closing bell yesterday, when the Finance minister of Luxembourg gave off a big hint about there being no Greek deal. That — combined with a Moody’s warning on some big European banks late on Tuesday — set an immediate negative tone for the whole day.
- Then it was more and more Greece. There were huge teargas-filled austerity protests. 4 Greek banks got downgraded, and there immediately news reports of the bailout negotiations being “deadlocked”. The fundamental problem, still, is that Germans want to see bondholders take a haircut, while the ECB thinks this would immediately lead to a gigantic crisis.
- Greek markets got bludgeoned, and the selling was frightening early on. Athens stocks got killed, short-term yields went through the roof. Greek 2-year debt is now yielding over 28%
- There were rumours throughout the day that the Greek PM Papandreou would resign, or form some kind government of national unity with the opposition. But in the end, that’s not how it went down. Instead he’s pulling a Mubarak, hoping to buy some political power by firing his entire cabinet. He will hold a confidence vote on Sunday night.
- In the US there were two big datapoints that just made things worse. CPI came in hotter than expected. That disinflation will have to wait. Meanwhile, the Empire State Manufacturing index saw a dramatic plunge.
- As for the markets, all day there was that Flash Crashy-feel to things — what with the selling and the Greek protests — but in the end the dam never quite broke. The Dow was down 200 at one point, but we didn’t get the gigantic flush that would signify sheer panic. If you’re bullish you might even feel heartened by today’s action. Meanwhile, Treasuries and the dollar were huge winners. A major loser today: Oil.
- Some other notable things about today’s market: Pandora IPO’d, and though it originally had a gigantic pop, it ended up losing most of its pop. This is a very different market than when LinkedIn IPOd. All 10 S&P subsectors fell. Banks just keep getting drubbed. JPMorgan, Bank of America, and Citigroup all fell over 2%.
- Meanwhile, members of Congress had to reveal their stock holdings today. Click here to see what your favourite politicians are invested in >
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