After Market: Obama Talks Tough on Crimea, and Investors Shiver

Before you go, we thought you'd like these...
Before you go close icon

Stocks turned lower Wednesday after President Obama took a harder line against Russia. The president called for more sanctions against Russia in the wake of its invasion and annexation of Crimea, which raised fresh geopolitical concerns on Wall Street.
Saul Loeb/AFP/Getty ImagesIn a speech at the European Union headquarters in Brussels Wednesday, President Barack Obama said Russia stood alone on the Ukraine crisis, cementing Western opposition to its takeover of Crimea.
The Dow Jones industrial average (^DJI) gave up strong early gains to end down 99 points (0.6 percent), and the Standard & Poor's 500 index (^GPSC) fell 13 points (0.7 percent). But the Nasdaq composite (^IXIC) was the big loser, dropping 60 points (1.4 percent).

Facebook (FB) slid 7 percent after revealing it was paying $2 billion to buy Oculus, a virtual-reality headset maker. It's the company's second big acquisition this year.

Other big name Nasdaq stocks dragging the index lower: Twitter (TWTR), down 7 percent; Tesla (TSLA), down 3 percent; and Microsoft (MSFT), down more than 1 percent. Twitter, after a big run-up last year, is now down 36 percent over the past three months.

Panera Bread (PNRA) lost 7 percent on worries about earnings and a brokerage downgrade.

At the NYSE, the big story was the IPO of King Digital (KING), maker of the hugely popular game "Candy Crush." The stock –- you guessed it -- got crushed, falling 15 percent below its $22.50 a share offering price. Investors are concerned that King is a one-trick pony, and the company may never hit it big again after "Candy Crush" inevitably fades.

On the plus side, health care stocks rallied as House Republicans proposed a bill to avoid the planned cut in payments to Medicare providers. Quest Diagnostics (DGX) and Tenet Healthcare (THC) rose 5½ percent. Lab Corp (LH) gained 4 percent.

And Dish Network (DISH) rallied 8 percent on a Bloomberg report that it has approached rival DirecTV (DTV) about a merger. DirecTV gained 6 percent. The retailer Five Below (FIVE) gained 11 percent as earnings topped expectations. But International Game Technology (IGT) fell 8 percent after cutting its guidance.

Finally, a pair of small drug companies got clobbered. Insmed (INSM) fell 14 percent. The only drug it makes failed to meet targets for treating lung infections.

And Exelixis (EXEL) tumbled 39 percent on disappointing results from a trial of its prostate cancer drug.

What to Watch Thursday:
  • The Labor Department releases weekly jobless claims, and the Commerce Department releases final data on fourth-quarter gross domestic product -- both at 8:30 a.m. Eastern time.
  • At 10 a.m., Freddie Mac releases weekly mortgage rates, and the National Association of Realtors releases pending home sales for February.
These notable companies are scheduled to release quarterly financial statements:
  • Accenture (ACN)
  • GameStop (GME)
  • Lululemon Athletica (LULU)
  • Re/Max Holdings (RMAX)
  • Restoration Hardware (RH)
  • Winnebago (WGO)
-Produced by Drew Trachtenberg.

7 Tax Tips for Investors
See Gallery
After Market: Obama Talks Tough on Crimea, and Investors Shiver
The 1099 forms you received from brokerages and other financial institutions might not be the last ones they send. It's common for them to issue corrected versions a little later. Consider getting your tax return ready to go, then waiting until close to April 15 before submitting it. That way, you can incorporate any last-minute changes and avoid having to file an amended return.
Pay attention to when you sell any holding, because the capital gains tax rates differ for long-term and short-term holdings. Short-term capital gains are taxed at your ordinary income tax rate, which could top 30 percent. Long-term gains (those held for more than a year) get preferential rates, which are zero percent for those in low-income brackets and 15 percent for most of us.
If you own underwater stocks, consider selling them for a loss. You can use those losses to offset gains from other sales, reducing your taxes owed. You can always buy back the asset later, if you still believe in it -- just be sure to wait for 31 days to pass, to observe the "wash sale rule."
If you're planning to sell one or more holdings that will give you a really big gain, submit an amended W-4 form to increase your withholding, or send the IRS an estimated tax payment. Underpaying your taxes significantly during the year can lead to a penalty at tax time. You may be protected by a "safe harbor" provision, though, which can save you from having to jump through those hoops.
If you're planning to buy shares of a mutual fund, determine when it will distribute its dividends. Many funds do so near the end of the year, and when that happens, the fund's share price will drop by the amount of the distribution -- which is taxable to shareholders. It's better to just wait until after that payout to buy in.
Mutual funds with high turnover ratios (reflecting a lot of buying and selling in a fund) have expenses for these trades. It's worth favoring funds with low turnover ratios, especially index funds and index-tracking ETFs, which simply hold onto the mix of securities in a given index, without a lot of trading activity. (Index funds generally outperform their higher-turnover counterparts, too.)
Boost the power of your Individual Retirement Accounts by making your annual contributions early in the year, giving the funds more time to grow. Over decades, it can make a significant difference.
Read Full Story

People are Reading