On Wednesday, in light trading, stocks were down for the third straight day thanks to the ongoing anxiety over the possible budget cuts, increase in taxes and the less than anticipated holiday retail sales figures. Trading was very light following the Christmas Day holiday, with the volume below this year’s daily average.
Many of the senior traders remained on vacation and major markets across Europe were closed for the holiday on Wednesday.
A number of investors announced concerns over the ongoing fiscal cliff negotiations that look to be at a standstill with only four days remaining before the $600 billion in budget cuts and tax increases automatically take effect. A number of analysts expressed concern that the markets would remain unstable until a decision was reached on the crisis in Washington.
Nevertheless, strong performers for the year did advance on Wednesday. Bank of America, which has close to doubled this year, was up another 2.6% on Wednesday to close at $11.54.
However, retail sales during the holiday season (October 28 – December 24) were up only 0.7% this year after increasing 2% during the same period in 2011.
Many shoppers were reluctant to spend large sums of money during the holiday shopping period as they were unsure what would happen regarding the fiscal cliff and if it would be averted.
A number of retailers such as Abercrombie and Fitch, Amazon.com, Gap, Ralph Lauren and Limited Brands all were down on the day after the holiday sales figures were released.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.