US Midday: Facebook slides, euro worries continue
May 25, 2012
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- Stocks fluctuate on Europe fears
- Consumer sentiment highest since 2007
Dow: -0.2%
S&P 500: +0.06%
NASDAQ: -0.09%
Wall struggled between impressive consumer sentiment numbers and growing alarm at developments in Europe.
The Thomson Reuters/ University of Michigan consumer sentiment index rose to 79.3 in May, better than the 77.8 economists had been predicting. It has now reached its highest level since 2007.
In Europe, however, the news flow is still unsettling. It seems the provincial government of Catalonia is running out of ways to finance its debts and will be asking the central government for help. The trouble is, the Spanish government is strapped for cash itself, having spent billions supporting the banking system.
There has been some suggestion that a common "euro bond" could be created as a way to mitigate risk and bring down borrowing rates for the under-pressure European economies.
But euro bonds are a long way off, in the meantime various sources have reported new loans in China for the whole of 2012 will only amount to 7 trillion yuan, 1.5 trillion less than the Chinese government had been expecting. If true, these figures would confirm a Chinese slowdown.
COMPANIES
Facebook was down in morning trading as concerns over the initial IPO price continued to weigh down on the stock.
Chesapeake Energy rose after activist investor Carl Icahn became one of its biggest shareholders.
Google had fallen 2.3% by midday as a number of big companies faced sell offs.
BS
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