Why The Dow Sank and Google Gained After Hours

Stocks tumbled today as concerns about escalating tensions in Ukraine combined with a weak housing report to push major indexes down by about 1%. The Dow Jones Industrial Average  (DJINDICES: ^DJI  ) lost 161 points, or 0.9%, while the S&P 500 fell 1.2%, and the Nasdaq dropped 1.4%. Reports this afternoon that a Malaysian Airlines jet crashed near the border or Russia and Ukraine pressured stocks down further, as authorities claimed a missile had destroyed the jet. News that Israel sent ground troops also had investors on edge as tensions increased in the Middle East. 

Back home, June housing reports came in at an annual rate of 893,000, well below estimates at 1.02 billion. Analysts have been expecting the housing market to bounce back this year, but it has mostly flatlined after what looked like the beginning of a recovery last year. June building permits were also lower than expected at an annual rate of 963,000 against estimates of 1.04 billion, and both figures were down from May's totals.

Outside of housing, data was rosier as initial unemployment claims fell to 302,000, down from 305,000 the week before, and better than the 311,000 economists had projected. The four-week moving average also fell to 309,000, its lowest point since June 2007, a strong sign for the rapidly improving labor market. Continuing unemployment figures also fell, reaching lows not seen since 2007, as well. Finally, manufacturing numbers remained strong as the Philadelphia Fed's index came in at 23.9 for this month, well above 12.5, and ahead of June's total of 17.8, indicating a robust expansion in the mid-Atlantic region.

Google  (NASDAQ: GOOGL  )   (NASDAQ: GOOG  ) was the major tech company to report earnings this season, rising 1% on mixed results. The search giant said adjusted earnings improved to $6.08 a share, short of estimates at $6.24, though revenue soared 22%, to $15.96 billion, eclipsing expectations at $15.61 billion. Expenses rose more than expected as the company invests heavily in projects, including fiber networks, Google Glass, and self-driving cars in an attempt to diversify away from search. Google's cost-per-click, or the money it makes from individual clicks on Adwords, fell again to 6%, but paid clicks jumped 25%, more than making up for the fall in price.

Separately from the results, the company said its Chief Business Officer Nikesh Arora would be leaving the company to become an executive at Softbank. The departure was a surprise, but did not seem to get in the way of results, as investors are happy to cheer 22% top-line growth from a company the size of Google. 

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