This blog does not normally comment on daily changes in the DJI but this week points out how the index can appear weak because of one heavily weighted listing, in the case, JP Morgan Chase was responsible for 83% of the DJI loss. The $2 billion loss is an echo of past derivative trading debacles...
Dow Has Its Worst Week in 5 Months - WSJ.com
By MATT JARZEMSKY
The Dow industrials edged lower to cap their biggest weekly retreat of the year,
as a 9.3% drop in J.P. Morgan Chase's JPM -9.28% shares weighed on the blue-chip index.
The Dow Jones Industrial Average fell 34.44 points, or 0.3%, to 12820.60, erasing earlier gains after reports of a Securities and Exchange Commission review tied to at least $2 billion in trading losses at J.P. Morgan.
J.P. Morgan Chase fell $3.78, to $36.96, its biggest percentage slide since August. The drop accounted for 83% of the Dow's decline. The index fell 1.7% on the week, its worst weekly performance since mid-December.
J.P. Morgan said late Thursday that it had taken at least $2 billion in trading losses in the past six weeks, stemming from bad derivatives bets. The company said it could face an additional $1 billion in losses in the second quarter due to market volatility. The news shaved $14.4 billion from J.P. Morgan's market value, as 216.2 million shares in the bank changed hands, topping the record of 194 million on Nov. 21, 2008.
Steven Russolillo has details on The News Hub. Photo: Reuters.
Asian markets fell, weighed down by J.P. Morgan Chase's news and some disappointing data out of China. Japan's Nikkei Stock Average and China's Shanghai Composite each shed 0.6%. Industrial output growth in China slowed in April to the lowest level since May 2009.
Crude-oil prices lost 1%, to settle at $96.13, while gold prices declined 0.7%, to finish at $1,583.60 a troy ounce. The dollar rose versus the yen and euro.
Source: http://online.wsj.com
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