Yesterday, the market responded to a mixed bag of news. The Nasdaq (INDEX: ^IXIC ) ended the day 0.99% in the red, while the Dow Jones Industrial Average (INDEX: ^DJI ) and the S&P 500 were relatively flat.
The day started off sending all three markets into the red, with the Nasdaq clocking the biggest negative swing following an earnings miss and lower revised estimates from Oracle (Nasdaq: ORCL ) . In a bit of guilt by association, the news pulled many other tech stocks lower, including IBM and Hewlett-Packard.
KB Home (NYSE: KBH ) fell as well, contrasting with the 10% pop it realized the day before, after reporting a decline in quarterly profit and weaker gross margins. There was also an announcement from the National Association of Realtors on revised housing sales from 2007 onward.
Euro moves
The biggest news to hit the market was the next chapter in the saga that is the European debt crisis. The European Central Bank decided to hand out a massive $650 billion in funds to ease the credit crunch facing the continent. The funds are to be issued in the form of three-year loans to more than 500 European banks.
The markets were unimpressed in intraday trading, as all the major indices were lower. High demand for the funds illustrates that banks are increasingly relying on the ECB to solve their problems. There is concern that the banks will simply sit on the funds to shield themselves from further loses.
However, the markets seemed to eventually warm to the news, as both the Dow and the S&P ended the day in the black, while the Nasdaq recovered from its nearly 2% depths for the day.
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