U.S. stocks weak Wednesday on European woes

Diane Alter – Fourth Estate Cooperative Reporter

New York, N.Y., United States (4E) – U.S. markets opened weak Wednesday as worries over Europe’s debt saga, namely the Spanish banking system, again rattled investor confidence.

Right after the opening bell on Wall Street, the Dow Jones Industrial Average sank 133 points, the Standard & Poor’s 500 fell 16 points Index and the NASDAQ tumbled 40.

The European Central Bank issued a statement Wednesday stating it had not approved a bailout for Bankia, Spain’s No. 4 bank, adding that such a recapitalization could not be provided by the Eurosystem.

Also, independent ratings agency Egan-Jones downgraded Spain’s sovereign debt late Tuesday.

The move stirred up new questions about the country’s ability to fund bank bailouts that could reach as much as 100 billion euros.

The yield on 10-year Spanish debt soared to 6.62 percent Wednesday, as investors flocked to U.S. treasuries.

Additionally weighing on markets was a report that showed the European Commission’s economic sentiment fell for the second consecutive month, hitting the lowest level since October 2009.

World markets sank on Europe’s woes.

In U.S. corporate news, Blackberry maker Research in Motion gave investors the quivers and made dire hard fans of the phone nervous after the struggling company announced it is seeking strategic alternatives, including possibly a sale.

Shares of Facebook continue to falter, taking the stock of the social network behemoth down to $ 29 after debuting May 18 at $ 38 a share.

The dollar rose against the euro and the British pound, but lost ground against the japans yen.

Oil for June delivery slide $ 1.05 to $ 89.71 a barrel. Gold, meanwhile, gained $ 5.90 to $ 1,554.60 a troy ounce.

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