Stocks waver as Europe works to fix debt crisis

Finland becomes the latest nation to approve a plan to boost the eurozone's rescue fund. Greece makes progress on meeting aid requirements. US durable-goods orders drop. Amazon unveils a new tablet.

By TheStreet Staff on Wed, Sep 28, 2011 7:35 AM

Image: Wall Street sign (© Corbis/SuperStock)

By Melinda Peer, TheStreet

Updated at 12:50 p.m. ET

Stocks wavered Wednesday as continued signs of weakness in the U.S. economy and ongoing uncertainty regarding Europe’s plan for financial stability threatened to sap some momentum from U.S. equities’ three-day winning streak.

The Dow Jones Industrial Average ($INDU) was gaining 21.6 points, or 0.2%, at 11,212. The S&P 500 ($INX) was down 3.5 points, or 0.3%, at 1,171, and the Nasdaq ($COMPX) was lower by 9.6 points, or 0.3%, at 2,537.

Belief that European leaders are committed to taking action to stabilize the eurozone has helped fuel U.S. equities to three consecutive sessions of gains despite fears of a U.S. slowdown. On Tuesday, the Greek Parliament approved a new property tax that was considered crucial for the debt-laden country to get its next bailout installment. Comments from European Commission President Jose Manuel Barroso on Wednesday urging European leaders to do whatever it takes to protect the eurozone were also supporting hopes that the region will develop a unified plan to prevent financial weakness from spreading.

Wednesday also brought news that Finland's parliament approved proposed changes to the European Financial Stability Facility, the region's bailout fund, a day after Slovenia gave its okay. However, all 17 members of the eurozone must to agree to the changes and there has been some disagreement recently regarding how big the writedowns of private creditors' holdings of Greek bonds should be. Germany is scheduled to vote on Thursday.

Contributing to uncertainty on Wednesday was another sign of weakness in the U.S. economy. The U.S. Census Bureau said orders dipped 0.1% in August, missing expectations for an uptick of 0.2%. Orders, excluding transportation, also fell by 0.1%. August's declines compare to growth of 4.1% and 0.7%, respectively, in July.

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The FTSE in London finished down 1.4%, and the DAX in Frankfurt fell 0.8%. Overnight in Asia, Hong Kong's Hang Seng lost 0.7%, while Japan's Nikkei added 0.07%.

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The minor opening strength is being sold as market players are unable to find a new positive catalyst,” said Real Money contributor Rev Shark said in a an early blog post Wednesday. “There is continued wrangling in Europe, but nothing specific enough to push traders to act. They know we can be hit with another Greece-is-saved headline at any minute, but the bears have no shortage of negatives to exploit while we await the next round of bailout rumors.”

The basic materials sector was putting in the weakest performance with Alcoa (AA) and DuPont (DD) among the Dow’s biggest laggards.

The Dow’s tech components -- Microsoft (MSFT) and IBM (IBM) -- were trading near the top.

In corporate news, shares of Amazon.com (AMZN) are gaining 4.4% to $234.20 on the company’s unveiling of its new tablet device, the Kindle Touch. The product is Amazon’s response to Apple’s (AAPL) iPad and prices will start as low as $99.

Electronics manufacturing services company Jabil Circuit (JBL) reported better-than-expected fourth-quarter earnings and issued a bullish outlook for its first quarter late Tuesday. The stock was gaining 8.8% to $18.92.

Human resources and benefits outsourcing company Paychex (PAYX) saw its stock advance 2.1% to $27.26 after it topped analysts' estimates by 3 cents a share with first-quarter earnings of 41 cents a share.

The Energy Information Administration said crude oil inventories rose by 1.9 million barrels in the week ended Sept. 23. Analysts had expected supplies to remain unchanged, according to a Platts poll of analysts. Late Tuesday, the American Petroleum Institute said crude supplies rose by 568,000 barrels last week.

The November crude oil contract was shedding $1.83 to trade at $82.62 a barrel, and gold for December delivery was down by $14.40 to trade at $1,638.10 an ounce.

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The dollar was weakening against a basket of currencies, with the dollar index down by 0.171%.

The benchmark 10-year Treasury was declining 25/32, pushing the yield to 2.056%.

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164Comments

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stx013

50 minutes ago

Just guessing Tog. You have a good one.

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stx013

57 minutes ago

Yo TOG, Casey's is on Whittaker, but I don't think they have Keno. Casino close by and golf. Just wondering?

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Love of Money

7 hours ago

And while on the subject of (or were we?) transplanting jobs to China, fer giggity sakes, who is this Chao Deng? Are we outsourcing our reporting now, too?

{sorry TOG, just had to 'go there' didnt I?}

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Love of Money

7 hours ago

TOT-Bro...not to mention, how herky jerky people walked back in the "olden" days. Stupid young people, oh well...we were that way once.

TOG: I think there are many who prefer TAX in the barrel. And the cover back on, too.

I know its strange, but I like to hear from dissenting viewpoints, if only to sharpen my argumentative skills.

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M T

7 hours ago

But you are right. I take it back...no more oppression by the Fascist Insect which preys upon the Life of the People (speaking of some other 70's trends).

A progeny asked the other day if the 70's was in black and white.. then they looked at the old movies and concluded Oh! it was just not in HD :(

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Re-TOG Re-TOG (Re-TOG)

7 hours ago

What were you figuring LOM......Tax in the barrel ??

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Re-TOG Re-TOG (Re-TOG)

8 hours ago

Another form of a blanket party that seem to work well....

Was wrap'em in a blanket, walk'em to the stairwell, let'em go....

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Love of Money

8 hours ago

Hey, thats just plain wrong. What happened to our traditional 'window dressing' for the quarter?

1 1

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Re-TOG Re-TOG (Re-TOG)

8 hours ago

Nothing I like better then 300 pt. swing in a day..They can just kiss my fat white A$$.

You guys even drove poor Dek over to Charley's Late blog with the crazies.

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Taxpayer 1

8 hours ago

Jar, a blanket party is when a few guys throw a blanket over someone ( the honoree) and then other guys hit the guy under the blanket with socks that have bars of soap inside.

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Love of Money

8 hours ago

Gosh TOT-O ....you are definitely stuck in the Seventies, but thats okay, it was an interesting decade.

But you are right. I take it back...no more oppression by the Fascist Insect which preys upon the Life of the People (speaking of some other 70's trends).

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Lhiannon27

8 hours ago

some days I almost wonder if they wait for commentators to make up their minds for them....

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Jarlaxle123

8 hours ago

Jar, I know this may be a challenging concept for you but you can usually figure it out by talking to others. I suggest if you ever get in that you don't look too closely, you will most likely be the honoree of a blanket party

TP,

Yes, far too challenging a concept for me... I know when I talk with people I always try and pidgeonhole them as liberal or conservative... it's most useful.

I don't even know what a blanket party is, apparently I'm not missing out.

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M T

8 hours ago

Its rather egalitarian, dont you think?

Hence the reason why it will fail. They are trying to get rid of Social Security and Medicare for god's sake.Can you imagine all of these highly trained citizens taking to the streets in protest? Quickly make the sign of the cross and say three hail marys and two glory bees.

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M T

8 hours ago

Wow in the last several posts I recognize the following words (what can i say I'm easy on the education), so I will phrase as a question:

What is Black, white, chinese (close enough), and I quote "Thats funny TAX, I always had you figured for a "Navy" man"

Anwer: Clap fast three times, clap three more times fast, clap,twice followed two more by a single clap.. in a 3-4 musical beat and then sing.. Shame on you shame on you as the new recruit... What is The Village People?

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Love of Money

8 hours ago

Thats funny TAX, I always had you figured for a "Navy" man.

Ya know, VOLCKER...it might not be all bad for kids to have to go through some sort of short (maybe 6-12 months) of Military service type training, so an ever-ready reserve force is in the wings, ready for deployment in the event we actually did get attacked, but more so for the character building it implies. I dont see Israeli kids being harmed by kibbutz and compulsory service. Its rather egalitarian, dont you think?

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VolckerFan

8 hours ago

Tax: If you think it's oppressive to have a drug policy are arrest people who are using drugs, certainly compulsary military service, the government dictating not only a decision of leisure but how you spend years of your adult life, would certainly be considered oppressive, no?

And I never talked about the propotion between left and right leaning vets I know. Only that there are a substancial number of them. I'd say of the vets I know... around 15 or so, 5-6 are liberal leaning. One was an outright communist, embarassing to be around. The left leaners are definately in the minority. That's also why I draw the probably somewhat premature conclusion about the right leaning signing up more for patriotic reasons. The left leaners I know enlisted largely because they had nothing else to do and it was a secure few years that they could get free training and education. My experience with them has been that it was more of a self-interest in enlistment, less of a patriotic drive that the right leaners exude. The 3-4 of the rightys also reenlisted or signed up for the reserves once their initial tour was up.

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Taxpayer 1

9 hours ago

VF, I have no problem with some moron using crack everyday until he gets driving down the road looking for more or he's breaking into someone's house looking for more crack money.

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Taxpayer 1

9 hours ago

VF, and I think around 20% as liberals ( there is also a race issue as about 15% are minorities). It used be 2/3 were conservatives a few years back. The conservatives switched to independents not liberals.

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VolckerFan

9 hours ago

Tax: They also carry health insurance and pay taxes. Are you saying that they're happy with the need to carry health insurance under pentalty of fine? Are you saying that you would be OK with the government oulawing cigarettes and alcohol since you personally don't smoke or drink?

Ron Paul, Mr. Libertarian, doesn't think people should take drugs, in fact he thinks it's a very bad idea. He just doesn't think it's the government's job to force it. The standard line is that it isn't the government's job to regulate good sense.

Oh.. and here.. 41% of the miliary ID themselves as GOP as of April 2010:
http://www.navytimes.com/news/2010/04/military_poll_advance_041110w/

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Wednesday, 28 September 2011