Stocks Slammed by Fiscal Cliff Fears
NEW YORK (TheStreet) -- The major U.S. equity averages plunged Wednesday as worries about the fiscal cliff rattled investors in the wake of Tuesday's status quo election results.
The bears were out in force after President Barack Obama won a second term in The White House, the Republicans maintained control of the House of Representatives and the Democrats kept the upper hand in the Senate.
The lack of a shift in the political landscape racheted up fears that getting Democrats and Republicans will be able to cooperate and act decisively to address the looming expiration of certain tax cuts and other legislative measures.
Violent protests in Greece as the country's parliament votes on austerity measures also added to the dour mood. Bonds made a huge move higher with the 10-year Treasury jumping 1 1/32, pushing the yield down to 1.642%.
The Dow Jones Industrial Average lost 313 points, or 2.36%, to close at 12,933. It was the blue-chip index's first close below 13,000 since Aug. 2.
The weakest sectors in the broad market were capital goods, energy, financials and technology; all of which were down more than 2%. Every industry group was under significant selling pressure though, losing more than 1%.
Apple (AAPL) , whose shares tumbled 3.8% was among the hardest-hit names in technology. The iPad maker was told by a Texas federal jury Tuesday to pay patent holding firm VirnetX(VHC) $368 million to help settle a patent dispute. VirnetX soared 28.4%.
Decliners were ahead of advancers by a 4.3-to-1 ratio on the Big Board and 5.7-to-1 on the Nasdaq. Volume totaled 4.30 billion on the New York Stock Exchange and 2.03 billion on the Nasdaq.