Stock Markets Fall 4% Ahead Of US Non-Farm Payrolls

Further worries plagued Wall Street causing greater pullback from investors due to increasing problems in major banks and General Motors Corp (GM).  The Dow Jones Industrial Average (^DJI) fell a shocking -4.09% to a close of 6,594.44 while the Nasdaq (^IXIC) and S&P (^GSPC) fell equally -4.00% and -4.25% respectively to closes of 1,299.59 and 682.55.  Gold jumped $4.40 to a close of $932.20 while crude oil remained unchanged at $43.61.  The latest torrent of selling came ahead of the February Labor Department report that is likely to show hundreds of thousands of jobs were lost.  Reports showing better-than-expected retail sales and factory orders today weren’t enough to boost investor confidence.

Wal-Mart Stores Inc.’s (WMT) sales performance in February far exceeded analysts’ estimates, while other U.S. retailers also weathered the slump in consumer spending better than expected.  Wal-Mart noted their success in falling gas prices that significantly boosted household disposable income in February and therefore allowed for both more trips and more spending towards discretionary categories.  Wal-Mart also said it is raising its annual stock dividend by 15% to $1.09 a share.

General Motors Corp.’s (GM) auditors cast doubt today on the Detroit auto maker’s ability to survive without more U.S. government loans, in a foreboding assessment of the company’s financial plight.  GM’s continuing losses, negative net worth, and an inability to generate cash for continued operations led the auditors to determine there was substantial doubt that the company can survive.  GM warned last week it may not be able to able meet its auditors’ going concern requirements.

Capitalizing on recent years of soaring oil prices and conservative investment, Exxon Mobil Corp. (XOM) said it will boost spending on energy exploration and production by 11% to $29 billion this year.  Exxon’s spending increase comes as oil prices are currently at five-year lows below $45 a barrel as the global recession drives down demand for oil and natural gas.

Disclosure: The mutual fund the author manages is long XOM.

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