Nov. 9 - Summary of business headlines: Worst day for stocks since August as Italian bond yields spike, Greece in chaos; Cisco beats; GM warns; Goldman faces higher liabilities.
Wall Street had its worst day since August.. with both the S&P and the Nasdaq now in negative territory for the year. In Italy, bond yields shot to over 7 percent- their highest level since the euro was introduced in 1999. That increased worries Italy will be the next to need a bailout, and that the European debt crisis is getting worse. And in Greece, George Papandreou stepped down and a new leader was expected to be named. But coalition talks fell apart late in the evening. The news put US investors on edge. Jim Bianco is the President of Bianco Research. SOUNDBITE: JAMES BIANCO, PRESIDENT, BIANCO RESEARCH (ENGLISH) SAYING: "I think that the optimism that investors had regarding a positive outcome in Europe is dead for right now. Now maybe the stock market can regain optimism on another front like the economy here does better or the Fed does QE3 but Europe itself right now, any hope that there was going to be something positive there I think is gone" But after the market closed in the US- some encouraging corporate news. Cisco reporting earnings that were better than expectations. Shares moved higher in after hours trading on the news. Earlier in the day, General Motors announced a 15 percent drop in profits thanks to a loss in Europe, because of that the automaker lowered guidance for the current quarter. Goldman Sachs is facing higher liabilities tied to mortgage securities than previously revealed. The bank faces lawsuits totaling almost $16 billion, according to a regulatory filing. The bank is accused of knowingly misrepresenting the quality of mortgage-backed securities, the kind which helped usher in the financial crisis Turning to the final numbers: bank stocks led the market sell-off due to concerns about exposure to European debt. In European action, political instability weighed on the markets, resulting in triple-digit losses in Germany and the U.K. Bobbi Rebell, Reuters