U.S. Stocks Fluctuate Amid Federal Investigation and Technology Takeover Offer

Strategic Insights -

U.S. stocks seesawed on Thursday as reports of a federal investigation into mortgage-bond deals and a takeover offer for Sybase Inc. fueled volatility. The Standard & Poor's 500 Index dropped 0.2 percent, while the Dow Jones Industrial Average declined 6.87 points. Citigroup Inc. and Deutsche Bank AG led declines in financial shares, while Sybase surged 15 percent after receiving a takeover offer. New York prosecutors are investigating eight firms over whether they misled rating companies about mortgage-backed securities.

Key Takeaways:

  • U.S. stocks fluctuated on Thursday amid reports of a federal investigation into mortgage-bond deals and a takeover offer for Sybase Inc.
  • The Standard & Poor's 500 Index dropped 0.2 percent to 1,169.69, while the Dow Jones Industrial Average declined 6.87 points to 10,890.04.
  • Citigroup Inc. and Deutsche Bank AG led declines in financial shares, with Citigroup falling 1.4 percent to $4.12 and U.S. shares of Deutsche Bank AG dropping 1.9 percent to $63.79.
  • Sybase surged 15 percent after a takeover offer, spurring speculation that other technology companies will be acquired.
  • New York prosecutors are investigating eight firms over whether they misled rating companies about mortgage-backed securities.
  • The European Central Bank's almost $1 trillion financial-aid package has made investors wary of investing in the region due to downgrades of Greece, Spain, and Portugal.
  • Citigroup's bank losses stemming from the collapse of the U.S. subprime mortgage market in 2007 totaled about $1.78 billion globally.
  • Cisco Systems Inc. retreated 4.5 percent to $25.54 after forecasting sales of at least $10.7 billion in the current period.
  • Cisco's forecast beat the $10.6 billion average prediction of analysts surveyed by Bloomberg, but estimates ranged as high as $11 billion.

Statistics:

  • The Standard & Poor's 500 Index dropped 0.2 percent to 1,169.69.
  • The Dow Jones Industrial Average declined 6.87 points to 10,890.04.
  • Citigroup Inc. fell 1.4 percent to $4.12.
  • U.S. shares of Deutsche Bank AG dropped 1.9 percent to $63.79.
  • Sybase surged 15 percent after a takeover offer.
  • The European Central Bank's financial-aid package is valued at almost $1 trillion.
  • The European Central Bank plans to buy government and private debt.
  • Cisco Systems Inc. forecast sales of at least $10.7 billion in the current period.
  • Analysts surveyed by Bloomberg predicted Cisco's sales to be $10.6 billion on average.

Sources:

  • Bloomberg
  • Euclid Infotech Pvt. Ltd.
  • Albawaba.com