The Dow Jones Industrial Average was hammered on Thursday and the S&P Volatility Index soared after a Malaysian Airlines plane crashed in a Ukrainian war zone on suspicions it was struck by a missile. In addition, multiple big name brands slumped heavily after failing to meet second-quarter earnings expectations.
The crash in Torez, Ukraine killed 295 people, including 23 Americans, just 25 miles from the Russian border. Both governments and pro-Russian separatists have denied responsibility for the incident, and an investigation is well underway. The event had a hard impact on the airline industry. The NYSE Arca Airline Index (INDEXNYSE: XAL) was down 2.6 %.
Here's the scorecard from today's trading session:
DOW: 16,976.81, -161.39 (-0.94%)
NASDAQ: 4,363.45, -62.52 (-1.41%)
S&P 500: 1,958.12, -23.45 (-1.18%)
And here are the top stories that affected the stock market today:
- Volatility Spikes: The S&P Volatility Index, commonly called the Fear Index, shot up nearly 40% after today's plane crash in a hostile region of Ukraine. ProShares Trust II (NYSE: VIXY) popped by nearly 10%. Meanwhile shares of double inverse fund Credit Suisse AG - VelocityShares Daily 2x VIX Short Term ETN (Nasdaq: TVIX) soared more than 17% on the day. Get more on the VIX and how this powerful index works here.
- Russia Crushed: The Russian stock market plummeted on Thursday in the wake of the Malaysian jet crash and news of widened sanctions from the U.S. government. The Market Vectors Russia ETF (NYSE: RSX) and the iShares MSCI Russia Capped ETF (NYSE: ERUS) both slumped nearly 7%. Despite the widened sanctions, some are questioning if Russia's commitment to greater bilateral trade and financing with China will blunt the impact of the Treasury Department's actions.
- The Tech King Misses: Google stock (Nasdaq: GOOG, GOOGL) was up more than 2.3% in after-hours trading on news that the company missed second-quarter earnings by $0.15 per share. Despite missing per-share expectations of $6.25, the company still reported quarterly revenues of $15.96 billion against Street estimates of $12.32 billion. To read why Google remains a strong investment, despite today's earnings miss, read this after-hours assessment at Money Morning...
- Earnings Slump: Shares of Yum! Brands Inc. (NYSE: YUM) fell more than 5.5% on news that the company missed earnings, mostly due to declining sales at its Pizza Hut locations. Shares of Mattel Inc. (Nasdaq: MAT) fell nearly 6.5% on poor earnings and news that the toymaker's iconic Barbie product line continues to decline. Finally, AutoNation, Inc. (NYSE: AN) fell more than 6% after the nation's largest U.S. auto dealer group reported underwhelming earnings.
- Cut for Gains: Shares of Microsoft Corp. (Nasdaq: MSFT) jumped nearly 1% after the company formally announced it would slash 18,000 jobs as it absorbs Nokia's handset business. The layoffs represent a cut of 14% of the company's workforce and have many industry analysts wondering if Microsoft's CEO Satya Nadella is fully committed to the Nokia deal.
Now our experts share some of the most important investment moves to make based on today's market trading - for Money Morning Members only:
- Don't Hesitate on This Industry Boom That's Already Here: If you follow the headlines, you'd think the last place to invest your hard-earned money is in healthcare. But here's the thing. As technology investors, our job is to look beyond the politics of the moment and take a look at what others may be missing. Turns out, if you picked the right healthcare investment over the last two years, you would have beaten the S&P 500's returns by more than 50%. Here's why...
- Act on This Massive Profit "Spark" Ahead of the Big Boys: It's easy to see why investors pile into a company's stock on the heels of highly successful products, technologies, or services. For small caps, finding the right leader can prove a more critical "spark" to major profits. This is why you should follow Money Morning Small-Cap Investing Specialist Sig Riggs' advice and use these three steps to make big gains...
- The U.S. Export Ban Is a Windfall for These Companies: After more than four decades, it looks like America is getting back into the oil export business again. For the first time since the 1970s, Washington has opened the door to sending more U.S. crude abroad. And these companies are poised to profit big from the announcement...