Russell 2000 continues to drop
The Russell 2000 (NYSE: IWM) is posting steeper losses this afternoon, with the other major U.S. indices also in negative territory. At 2:00 p.m. ET, the small-cap index had lost 18.77 points, or 2.29%, to 799.76. The Dow Jones Industrial Average (INDU) was down 152.42 points, or 1.11%, to 13,523.81.
Small and large cap stocks are drowning in a sea of red following more negative news about the state of the U.S. housing sector and a nasty reminder of the far-reaching effects of the subprime mortgage meltdown on the financial sector.
Sales of existing U.S. homes fell 8% in September to an annual pace of 5.04 million, according to the National Association of Realtors. That’s the lowest level since the Washington, D.C.-based trade association started keeping tabs in 1999 and a sign that the credit squeeze is sapping demand. The pace of sales in August was 5.48 million.
The median price of an existing home was $211,700 in September, a drop of 4.2% from a year earlier.
The housing sector started to sag in the second half of 2006, leading to a wave of foreclosures and causing a mess in the subprime mortgage sector.
Before the opening today Merrill Lynch & Co Inc. (NYSE: MER) announced a wider-than-expected third-quarter loss, due to being overly exposed to securities backed by subprime mortgages.
Stocks fell out of the gate and the bears have been gaining strength ever since.
Elsewhere, the price of oil is up $1.36 to $86.63 on news of a decline in weekly U.S. oil inventories, as reported by the Energy Information Administration.
Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:
Biggest percentage gainers:
• Transmeta Corp. (TMTA), up 233% on news it settled a legal dispute with Intel Corp. (INTC).
• Flamel Technologies S.A. (FLML), up 16%.
• Superconductor Technologies Inc. (SCON), up 13%.
Biggest percentage losers:
• Hanmi Financial Corp. (HAFC), down 17% on news it expects a lower third-quarter profit.
• Hythiam Inc. (HYTM), down 16%.
• Wavecom S.A. (WVCM), down 16% on news of a decrease in third-quarter sales.
