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Friday, 09 December 2011 | 00:00
DJ30 PointChange: -198.67 Level: 11997.7 NASDAQ PointChange: -52.83 Level: 2596.38 NQ100 PercentChange: -1.6 R2K PercentChange: -3.1 SP400 PercentChange: -2.6 SP500 PointChange: -26.66 Level: 1234.35 NASDAQ-Adv:363 Dec: 2171 NYSE-Adv:405 Dec: 2600 BRIEFING.COM] Market participants displayed their bearish side by driving stocks down to weekly lows following a flurry of headlines from Europe. Some relief was offered in the final hour, but sellers redoubled their efforts.

News that the latest initial jobless claims tally declined to 381,000, which is less than the 395,000 initial claims that had been broadly expected, helped strengthen sentiment ahead of the open. Participants were hardly surprised by the European Central Bank (ECB) decision to lower its main refinancing operations rate to 1.00% from 1.25% and also trim the rate on its marginal lending facility to 1.75% from 2.00%, but buying was further bolstered by the ECB's move to extend collateral eligibility to asset-backed securities.

Buying interest was checked before the opening bell, though. The shift in sentiment was spurred by news that the ECB has turned more cautious in its economic outlook and that the vote to reduce interest rates was not unanimous. The proof of dissension among Europe's leading policy makers made many participants skeptical of the ability of officials at the eurozone summit, which is scheduled to conclude tomorrow, to progress in their efforts to overcome persistently precarious economic and financial conditions.

Also out today, the European Banking Authority's stress test results determined that bank recapitalization needs increased since a series of test results were issued in October. German banks were hit with especially stiff selling pressure following the report.

Amid the messy mosaic of eurozone headlines and a weaker picture of European banks, stocks were left to descend steadily throughout the session. In the closing minutes stocks tried to trim losses in conjunction with headlines that suggested a banking license may be tied to the eurozone bailout fund so as to allow direct bank recapitalization, but buying was quickly countered by sellers who were only stopped by the closing bell.

Advancing Sectors: (None)
Declining Sectors: Consumer Staples -1.0%, Utilities -1.5%, Tech -1.5%, Health Care -1.8%, Telecom -1.8%, Consumer Discretionary -2.0%, Industrials -2.3%, Energy -2.6%, Materials -3.0%, Financials -3.7%

Source: Briefing

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