By: JeeYeon Park CNBC.com Writer
Stocks closed in the red Monday, with the
S&P 500 moving further away from its all-time high, amid worries
over the bailout news in Cyprus and over fears the euro zone's bigger
troubled economies such as Spain and Italy may follow suit.
"In the short-run, it does raise a lot of nerves because the last thing you need in Europe is to see a decline in confidence," said Anthony Chan, chief economist at JPMorgan's Chase Private Client Business. "The good news is, they're working towards making this a little bit more palatable, perhaps lowering the amount that they ask for from the insured depositors or eliminating that and just focusing on the uninsured depositors, which I think would be a step in the right direction."
"In the short-run, it does raise a lot of nerves because the last thing you need in Europe is to see a decline in confidence," said Anthony Chan, chief economist at JPMorgan's Chase Private Client Business. "The good news is, they're working towards making this a little bit more palatable, perhaps lowering the amount that they ask for from the insured depositors or eliminating that and just focusing on the uninsured depositors, which I think would be a step in the right direction."
The Dow Jones Industrial Average slumped 62.05 points, or 0.43 percent, to end at 14,452.06. closing lower for the second-straight session, dragged by Boeing and Disney. Still, the blue-chip index remains on track for its best quarterly percentage gain since the fourth quarter of 2011.
The S&P 500 fell 8.60 points, or 0.55 percent, to close at 1,552.10. The Nasdaq declined 11.48 points, or 0.35 percent, to finish at 3,237.59.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, spiked nearly 20 percent to finish near 14.
Most key S&P sectors closed in negative territory, led by financials and energy.
The S&P 500 fell 8.60 points, or 0.55 percent, to close at 1,552.10. The Nasdaq declined 11.48 points, or 0.35 percent, to finish at 3,237.59.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, spiked nearly 20 percent to finish near 14.
Most key S&P sectors closed in negative territory, led by financials and energy.
Global markets were spooked by news of Cyprus'
plan to tax bank depositors to help fund a 10 billion euro bailout from
the European Commission, the European Central Bank and the
International Monetary Fund.This marks the first time depositors have
been asked to contribute to a financial-rescue plan during the
long-running euro-zone debt crisis.
Banks in Cyprus will remain closed until Thursday pending a decision by parliament to approve a levy on bank depositors.
"The difference between today's news from Cyprus and what this news might have meant a year ago is the Mario Draghi put, which means that the European Central Bank will probably step in in case of some sort of systemic risk," said Michael Sheldon, chief market strategist at RDM Financial. "It's going to be hard to really dent the recent uptrend in stock prices we've seen over the last few months without a significant piece of news."
Banks in Cyprus will remain closed until Thursday pending a decision by parliament to approve a levy on bank depositors.
"The difference between today's news from Cyprus and what this news might have meant a year ago is the Mario Draghi put, which means that the European Central Bank will probably step in in case of some sort of systemic risk," said Michael Sheldon, chief market strategist at RDM Financial. "It's going to be hard to really dent the recent uptrend in stock prices we've seen over the last few months without a significant piece of news."
All major banks were sharply lower across the board, including Credit Suisse and Morgan Stanley.
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The dow jones industrials is now on a roll. Watch out for a sharp sell off in early 2014. The central bank of the united states has been buying securities on the open market injecting 85 billion dollars every month into the markets. Make no mistake the situation in the united states is still very serious while the economy continues to improve very slowly. The united states must at some point deal with its massive national debt sprial which is currently growing by over 1 billion dollars a year.
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