US stocks have sunk in a second day of losses following President Barack Obama’s re-election victory, trimming another one per cent after Wednesday’s huge rout.
The spectre of a bruising political battle over the fiscal cliff and budget cutting added to more eurozone worries and lowered corporate outlooks to press share prices down.
But shares were also pulled down by another 3.6 per cent fall in shares of Apple, the world’s largest company by market capitalisation, taking its loss in the past five sessions to nearly 11 per cent.
The Dow Jones Industrial Average lost 121.41 points (0.94 per cent) on Thursday to 12,811.32.
The broad-based S&P 500 fell 17.02 (1.22 per cent) to 1,377.51, while the tech-rich Nasdaq Composite lost 41.71 (1.42 per cent) at 2,895.58.
The fall added to the Dow’s 313-point drop on Wednesday – the biggest one-day loss in a year – a day after Obama defeated Republican challenger Mitt Romney at the polls.
On the same day the S&P lost nearly 34 points and the Nasdaq nearly 75 points.
Traders said Wall Street, which had largely favoured Romney, was reacting more on worries of the looming battle between Democrats and Republicans over the deficit.
“If you were sitting yesterday and didn’t sell enough, you were nervous at the end of the day, and you got back involved and started selling,” explained Michael James of Wedbush Securities.
In addition, he said, “the complete technical breakdown of Apple today has forced a big risk reduction and positioning reduction.”
Apple shares lost another 3.63 per cent to $537.75, after falling 3.8 per cent on Wednesday.
Some analysts called it a correction in the stock’s price after a huge runup, while others cited worries about possible capital gains and dividend tax hikes from the beginning of the year.
Bank of America (+1.7 per cent) and Boeing (+1.2 per cent) were leaders in a handful of gainers on the 30-stock Dow.
Cisco (-2.2 per cent) and McDonalds (-2.0 per cent) led the losers.
Industrial equipment maker Babcock & Wilcox plunged 11.1 per cent despite beating earnings expectations in its fiscal first quarter with a $46.7 million profit.
Chip maker Qualcomm rose 4.4 per cent after delivering a fairly buoyant outlook for sales.
Bond prices were mixed. The 10-year US Treasury yield was flat at 1.63 per cent, and the 30-year fell to 2.77 per cent from 2.82 per cent on Wednesday. Bond prices and yields move inversely.
