With traders expressing continued concerns about the outlook for the global economy, stocks saw notable weakness during trading on Wednesday. The losses on the day extended a recent downward move for the markets, with the major averages falling to their lowest levels in about a month.
While most of the major sectors moved to the downside on the day, substantial weakness was visible among electronic storage stocks. The NYSE Arca Disk Drive Index fell by 3.8 percent to its lowest closing level in well over two months.
Hutchinson Technology (HTCH) and NetApp (NTAP) turned in two of the storage sector's worst performances, falling by 4.7 percent and 3 percent, respectively.
Oil stocks also came under pressure on the day on the heels of the news from Chevron. A notable decrease by the price of crude oil also contributed to the weakness in the sector. With crude for November delivery sliding $1.14 to $91.25 a barrel, the NYSE Arca Oil Index fell by 1.8 percent.
Significant weakness was also visible among semiconductor stocks, as reflected by the 1.4 percent loss posted by the Philadelphia Semiconductor Index. Steel, networking, and biotech stocks also posted notable losses.
The major averages ended the day firmly in negative territory, near their lows for the session. The Dow plunged 128.56 points or 1 percent to 13,344.97, the Nasdaq fell 13.24 points or 0.4 percent to 3,051.78 and the S&P 500 slid 8.92 points or 0.6 percent to 1,432.56. (RTT News)
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This is a predictable response to the debate. Romney went from a 15% chance of winning to a 30% chance of winning. Considering that the stock market does considerably better under democratic presidents, this makes sense.
One study showing that was Valcanov's which studied the CRSP index (value-weighted broad market from University of Chicago) over the period 1927 - 2000 and found it returned 2% over 3 month TBill rates under republicans and 11% over TBill rates under democrats.