Market Recap: European Hopes Sink, Durable Goods Orders Disappoint, and the Gold Dump Continues

Markets closed down on Wall Street today: Dow -1.61%, S&P -2.07%, Nasdaq -2.17%, Oil -4.26%, Gold -2.46%.

On the commodities front, Oil (NYSE:USO) fell to $80.85 a barrel. Precious metals were also down, with Gold (NYSE:GLD) falling to $1,611.90 an ounce while Silver (NYSE:SLV) fell 4.92% to $29.99 an ounce.

Hot Feature: Are Gold and Silver Bugs Running Scared?

Today’s markets were down because:

1) Europe. Though markets were up the last couple days because of positive news coming out of Europe, investors are now losing faith in European leaders’ ability act quickly and effectively to remedy the sovereign debt crisis and economic downturn abroad. So far, only eight of the seventeen euro-zone nations have ratified a measure that would increase funds to the European Financial Stability Facility, while EU and IMF officials won’t even announce whether Greece will receive its next tranche of aid until next week, at the soonest. Until there is a clear course of action with Greece and with Europe, markets will be prone to continued volatility.

2) Durable goods. The U.S. Census Bureau released its Advance Report on August Durable Goods this morning, showing that new orders for manufactured durable goods fell $0.2 billion, or 0.1%, in August to $201.8 billion. Last month’s decline was the second in the last three months — durable goods orders rose 4.1% in July. Primary metals declined last month after climbing for five consecutive months, and had the largest decline, falling 0.8% to $24.2 billion.

3) Materials. Some of today’s biggest decliners were materials stocks. Alcoa (NYSE:AA) fell 4.4%, making it the Dow’s worst performer, as the prices of some commodities faltered. Alpha Natural Resources (NYSE:ANR) and Cliffs Natural Resources (NYSE:CLF) were two of the worst performers on the S&P 500, falling 9.3% and 8.6% respectively. The basic materials sector declined 3.74%, more than any other sector by far.

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