WALL STREET : DJIA fell for 6th week; Dow spiral 173.45 points

6th Straight Weekly Decline Leaves DJIA South of 12,000
After a much-needed bounce on Thursday, the major market indexes resumed their month-long slide today. Signs of slower economic growth out of China sparked early anxiety, as did news of an unexpected increase in U.S. import prices during the month of May. Against this backdrop of downbeat data, slashed second-quarter guidance from Dow component Travelers Companies (TRV) was the final nail in the coffin. The insurance giant warned that it expects to suffer an operating loss during the quarter, due to more than $1 billion in catastrophe costs. Conversely, consensus estimates were calling for a per-share profit of $1.29. As a result, the Dow Jones Industrial Average (DJIA) ended below the psychologically significant 12,000 level for the first time in more than two months, putting an exclamation point on its longest weekly losing streak since 2002.

The Dow Jones Industrial Average (DJIA – 11,951.91) ended on a steep decline of 172.5 points, or 1.4%, as all but three of its 30 components closed in the red. Bank of America (BAC) bounced back from an early low on reports that it will close its proprietary trading desk, adding 1.4% to pace the few advancing blue chips. Meanwhile, Travelers and Pfizer (PFE) set the tone for the 27 declining Dow members, with each stock shedding just over 3%. The Dow notched its first daily close south of 12,000 since March 18, after finding an intraday foothold near the site of its rising 160-day moving average. The index declined 1.6% from last Friday's close, bringing its losing streak to six consecutive weeks.


The S&P 500 Index (SPX – 1,270.98) gave up 18 points, or 1.4%, to mark its lowest weekly close of 2011. The SPX bottomed out near 1,268 today, which coincides with its rising 10-month moving average. For the week, the SPX declined 2.2%. Finally, the Nasdaq Composite (COMP – 2,643.73) tumbled 41.1 points, or 1.5%, to mark its first weekly finish south of 2,650 since March 18. The COMP shed 3.3% for the week, and is now sitting on a loss of 0.3% year-to-date.

"There's a lot of emotion in this market at the moment, and the conversations among traders are nearly all leaning toward the bear side."
"A lot of us shook our heads as the market headed higher, despite higher energy prices, the economy and the turmoil going on abroad."


"The backdrop and cause for our weakness remains just as real as ever."
“We are going through a period where the economic expansion is likely to be coming in a bit softer than in the past.”
“The markets on the whole are reacting to what we think is a slowdown period of both the U.S. and the broader economy.”
“The past 30-year was pretty solid, considering the big decline in yields the past two weeks.”
“The bond market does look to be in a sound position with momentum on its side after the Treasury’s successful sale this week."
“The fact that today is a Friday might be significant. Investors have a tendency to not want to be long over a weekend. And the reality is that this euro-zone and sovereign debt issue is very much in play.” 
“We have had a steady drumbeat of weak economic news. There is really nothing on the horizon to suggest in the very near term that trend is going to change.” 
“And to put a cherry on top of the scenario, as far as downside pressures, you have this significant unease surrounding exactly what is going to come from the Greek debt issues."

Crude oil slips below $100 per barrel
Crude futures took a dive today, as traders learned that Saudi Arabia may diverge from the rest of the Organization of Petroleum Exporting Countries (OPEC) by boosting its production output. Strength in the U.S. currency also applied pressure to the dollar-denominated commodity, as did a general lack of risk appetite among increasingly jittery investors. By the close, crude oil for July delivery dropped $2.64, or 2.6%, to end at $99.29 per barrel. On a weekly basis, black gold shed 0.9%. 

HAPPY WEEKEND