FX.co ★ The US stock market review for November 30, 2010

By the end of trading on Tuesday the US stock indices fell against the background of remaining worries over the Euro-zone debt crisis. The Dow Jones Industrial Average dropped by 46.47 points, or by 0.42%, to 11006.02 points. The Nasdaq Composite lowered by 26.99 points, or by 1.07%, to 2498.23 points. The Standard & Poor’s 500 decreased by 7.21 points, or by 0.61%, to 1180.55 points.
Bank of America shares shed by 3.2%. The quotes of Procter & Gamble edged lower 1.7%, and Hewlett-Packard lost 1.6%.
The drop was limited by the rise of Caterpillar shares by 1.1% due to better- than-expected reading of Chicago PMI. Wal-Mart Stores shares grew by 0.5%, and Walt Disney stocks advanced by 0.3% after the Conference Board CPI topped the forecasts. Google stocks fell by 4.5% after it was announced that the company intends to purchase Groupon for $6 billion. Meanwhile, the European Commission started investigation directed against Google. The company is suspected of abusing its dominant positions on Internet-search market. The technology sector shares showed the strongest decline. Investors were encouraged by the better-than-expected data in manufacturing and consumer confidence; however, these reports were overshadowed by remaining investors’ concerns over Euro-zone. Since investors are still worried by the fact that sovereign debt crisis in Europe could widen to Portugal, Spain and Italy, the yield spread between Spanish and German bonds has exceeded three percentage points, this is the largest gap since the euro has been launched. Amid the deterioration of market sentiment in regard to the Euro-zone, the European authorities plan a new round of bank “stress-test” that will be more rigorous rather than discredited tests conducted earlier this year. Global risk appetite was also negatively influenced by the talks that China would raise its interest rates and disappointing Japanese employment data. This situation promoted the increase in investors’ demand for safe haven assets such as the US dollar and treasury bonds.