Wall Street Slides on Concerns about Iraq by Angela Moon - Article Example

The president told the media that he refused to rule out US action in Iraq against the Sunni Islamic militia group who have spread out towards Baghdad and are threatening to divide the country and establish their own jihadist nation (Moon1). The stock market’s losses accelerated rapidly following President Obama’s comments, with industries and consumer discretionary sectors fronting the decline. The VIX, Wall Street fear meter, expanded to eight point three percent to end at 12.56% (Moon1).

The Dow Jones Industrial mean dropped 109.69 points or 0.65%, to end at 16,734.19. The S&P 500 tumbled 13.78 points or 0.71% to 1,930.11 (Moon1). The Nasdaq composite slid 34.30 points or 0.79 percent to 4,297.63. The Dow reached an intraday low at 16,703.73 while the S&P and the Nasdaq fell to a session low at 1,925.78 and 4,284.528 respectively. Retail sales, in macroeconomic news, rose 0.3 percent in May, almost half the growth rate that economists had projected. America’s new claims for unemployment grants rose unexpectedly in the previous week (Moon1).

Despite both economic indicators being below expectations, neither was considered weak enough to change the opinion of bettering economic states and the market’s recent uptrend is still considered intact. Energy shares ranked among one of the recent few gainers. The S&P energy section index rose 0.3%. Oil costs hit nine-month highs on concerns that intensified violence in Iraq could interfere with oil supplies from the key OPEC exporter (Moon1).

Major US Airlines’ shares dropped for the second day consecutively as oil prices increased. American Airlines Group Inc, the world’s largest transporter, slid 4.9 percent to $40.2 while United Continental Holdings Inc slid 5.9 percent to $42.60 (Moon1). One of Nasdaq’s most active stocks, Geron Corporation, surged 21.2 percent to $3.15 on heavy volume. This happened after the US food and drug administration ended a partial clinical ban on a study testing leukemia drugs (Moon1).

Restoration Hardware Holding, however, registered a 12.7% climb to $80.4 (Moon1). This happened a day after the luxury home furnishings retailer’s first-quarter results. Exchange volume lingered around 5.5 billion shares on US exchanges, faintly below the 5.76 billion means registered for the previous month, according to BATS’ global market database (Moon1).