Concerns about the macro picture were revived early this morning. Market participants digested data that indicated China experienced during November a slowdown in export growth, which many regarded as a sign of deceleration in the country that has helped prop up the global economy.

Sentiment in Europe soured as traders shifted their focus from the agreements struck during the eurozone summit to the difficult task of efficiently implementing plans and reaching a consensus on those topics that eluded officials last week. Responding to worries that such processes will continue to slog along without real results, yields on the debt of countries in the eurozone periphery were sent higher. The region's major bourses were also punished by sellers, such that the EuroStoxx 50 fell about 1.6%.

Weakness was exacerbated ahead of the open by a disappointing outlook from Dow component and semiconductor bellwether Intel (INTC 24.00, -1.01). The stock's 4% loss was its worst single-session slide in about 4% and dragged down the rest of the semiconductor space so that the Philadelphia Semiconductor Index shed nearly 3%.

In the face of widespread weakness telecom stocks were able to limit their losses to a collective decline of only 0.3%, which is about one-fifth of what the broad market suffered. In times of volatility, many analysts favor the sector for its stable businesses, strong balance sheets, and hefty dividends. That said, consumer discretionary plays also limited their losses to a collective decline of 0.3%.

Trading volume was paltry this session, coming in below 800 million on the NYSE. That makes for a more muddled picture when trying to assess sentiment since low share volume suggests less participation.

Favor for safety also compelled traders to rotate into the dollar, which gained about 1.2% against a basket of competing currencies by session's end.

Treasuries also traded higher, but the yield on the benchmark 10-year Note had difficulty breaking below 2.00%. Treasuries even had trouble adding to gains after results from an auction of 3-year Notes proved exceptionally strong. The auction drew a bid-to-cover of 3.62, dollar demand of $115.8 billion, and an indirect bidder participation rate of 39.1%. For comparison, an average of the past six auctions results in a bid-to-cover of 3.28, dollar demand of $104.8 billion, and an indirect bidder rate of 38.4%.

Advancing Sectors: (None)
Declining Sectors: Telecom -0.3%, Consumer Discretionary -0.3%, Consumer Staples -0.8%, Utilities -1.0%, Health Care -1.2%, Tech -1.5%, Industrials -1.8%, Materials -2.2%, Energy -2.4%, Financials -2.6%

Source: Briefing