After a big focus on earnings to start the second-quarter reporting season, the stock market has turned its attention to the increasing struggles in Europe. With the Spanish economy under threat from soaring bond yields and the euro falling against the U.S. dollar, investors moved to what they perceive as less-risky assets, and stock markets around the world sold off sharply. Just before 10:45 a.m. EDT, the Dow Jones Industrials (INDEX: ^DJI ) were off 184 points at 12,639.
Every stock in the Dow was down. Microsoft (Nasdaq: MSFT ) led the way with a 3% drop. Despite its recent announcement of its Surface tablet and the coming release of Windows 8, the software giant faces a lot of uncertainty about its future direction. With partner Nokia (NYSE: NOK ) having had its junk bond rating cut again by Moody's, Microsoft may not be able to rely much on Nokia to help further its attempts to increase its share in the mobile space.
In earnings news, McDonald's (NYSE: MCD ) fell 2.5% after its second-quarter profit fell slightly. The fast-food behemoth blamed the strong U.S. dollar for the drop, even as revenue rose a bit and same-store sales jumped 2.7%. If global woes continue, then dollar strength could hit a number of similarly situated multinationals that get a big portion of their revenue from overseas.
Finally, Chevron (NYSE: CVX ) fell more than 2% despite announcing a new natural-gas find off the western coast of Australia. With the exploration conveniently located near where Chevron is planning a liquefied natural gas export plant, the find bodes well for the company's strategy to supply hungry energy markets in southeast Asia.
How to fight Europe's woes
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