Stocks got off to a strong start today thanks to a solid durable goods report, but they faded over the course of the session as another tech sell-off and worries over Russia combined to turn markets downward. The Dow Jones Industrial Average (^DJI 0.23%) finished the day down 99 points, or 0.6%, while the S&P 500 dropped 0.7%, and the Nasdaq lost a full 1.4%.
At a meeting in Brussels today, President Obama and European officials discussed stepping up sanctions against Russia, including on its energy sector. Russia is a major exporter of oil and natural gas, especially to Europe, so any decision to avoid doing business with Russia could affect energy prices. Obama specifically promised "more consequences for the Russian economy" if it continued on its current course. Earlier in the morning, the Department of Commerce said that durable goods orders jumped 2.2% in February, better than estimates of 1%, on strong growth in orders for aircraft. Excluding the volatile transportation sector, orders increased just 0.2%.
The maker of Candy Crush Saga, King Digital Entertainment (KING.DL) fell 15.6% in its IPO today, the worst debut performance by a stock this year. The stock's slide today seems to reflect investor skepticism about the mobile gaming industry in general especially after Zynga, the maker of Farmville, became one of the bigger flops on the market in recent years. King has made over 180 games, but essentially all of its sales come from Candy Crush, and investors are concerned as sales seem to have peaked falling sequentially in its last two quarters from $620 million to $602 million.
After hours, shares of Citigroup (C -0.59%) were tumbling, down 5.7%, after it was the only major American bank to have its capital distribution plan rejected by the Federal Reserve. It was the second time in three years that Citi's plan was rejected as it requested permission to buy back $6.4 billion in shares and raise its dividend. The central bank said there were concerns about the bank's plans for crisis situations, acting on authority given to it by the Dodd-Frank act to ensure that banks are adequately capitalized for a potential recession. CEO Michael Corbat called the decision "deeply disappointing." The bank pays a quarterly dividend of just a penny per share now, good for a yield of 0.1%.
Finally, Facebook (META 2.24%) shares fell 6.9% as investors registered their distaste for its $2 billion purchase last night of Oculus, a maker of virtual reality gaming headsets. Oculus' product has not yet hit the market and it has no sales, but its technology seems to fit with the social network's desire to make the world more open and connected. Still, investors seem to be suffering from sticker shock, especially after Facebook spent $19 billion on messaging service WhatsApp.