The major stock indexes took big tumbles Thursday as a growing number of investing pundits turned more cautious. There are a couple of Wall Street conferences taking place this week, and some of the big name speakers are worried all of the sudden about the market's near-term prospects.
Also hurting the market -- another drop in the yield on 10-year Treasury notes, and a very weak report on economic growth across Europe. The Dow Jones industrial average (^DJI) slid 167 points, the Standard & Poor's 500 index (^GPSC) fell 17, and the Nasdaq composite (^IXIC) dropped 31 points.
And the Russell 2000 (^RUT), an index of small stocks that we don't follow on a day-to-day basis, briefly fell into correction territory, by which we means it had fallen 10 percent from its recent high. By comparison, the Dow and the S&P hit record highs earlier this week, while the Nasdaq is down about 7 percent from its best level of this year.
Drug and biotech stocks were active today as many companies released research reports at an annual meeting of the American Society of Clinical Oncology.
Bristol-Myers (BMY) fell 6 percent on disappointment over its lung cancer drug. The stock is now in the red over the past 6 months. Incyte (INCY) dropped nearly 10 percent after it reported that its drug to treat pancreatic cancer did not show much promise in treating other cancers.
On the upside, Clovis Oncology (CLVS) jumped 16 percent after reporting success in treating some forms of lung cancer.
Separately, Eli Lilly (LLY) fell 3 percent after losing a patent case in Great Britain.
The other sector under fire today was retail, after some disappointing earnings reports.
Walmart (WMT) fell 2-1/2 percent as its numbers missed expectations. Sales have now declined for five straight quarters. It's now in negative territory over the past year. Kohl's (KSS) fell more than 3 percent as net disappointed. J.C. Penney (JCP) lost 3 percent ahead of its earnings report. And a long list of other retailers fell. Macy's (M) and Lowe's (LOW) were both down more than 1 percent, while Sears (SHLD) and Urban Outfitters (URBN) were down more than 3 percent.
What to Watch Friday:
The Commerce Department reports housing starts for April at 8:30 a.m. Eastern time.
The University of Michigan releases preliminary results of its May survey of consumer sentiment at 10 a.m.
-Produced by Drew Trachtenberg.
10 Easy Ways to Pay Off Debt
After Market: Stocks Tumble as a Wind of Caution Chills Wall Street
"Your daily habits and routines are the reason you got into this mess," writes Trent Hamm, founder of TheSimpleDollar.com. "Spend some time thinking about how you spend money each day, each week and each month." Do you really need your daily latte? Can you bring your lunch to work instead of buying it four times a week? Ask yourself: What can I change without sacrificing my lifestyle too much?
Remove all credit cards from your wallet and leave them at home when you go shopping, advises WiseBread contributor Sabah Karimi. “Even if you earn cash back or other rewards with credit card purchases, stop spending with your credit cards until you have your finances under control,” she writes.
If you do a lot of online shopping at one retailer, you may have stored your credit card information on the site to make the checkout process easier. But that also makes it easier to charge items you don't need. So clear that information. "If you’re paying for a recurring service, use a debit card issued from a major credit card service linked to your checking account," Hamm writes.
Reward yourself when you reach debt payoff goals. "The only way to completely pay off your credit card debt is to keep at it, and to do that, you must keep yourself motivated," Bakke writes. Just make sure to reward yourself within reason. For example, instead of a weeklong vacation, plan a weekend camping trip. "If you aim to reduce your credit card debt from $10,000 to $5,000 in two months," Bakke writes, "give yourself more than a pat on the back."
“Establish a budget,” writes Money Crashers contributor David Bakke. “If you don't scale back your spending, you'll dig yourself into a deeper hole." You can use personal finance tools like Mint.com, or make your own Excel spreadsheet that includes your monthly income and expenses. Then scrutinize those budget categories to see where you can cut costs.
Sort your credit card interest rates from highest to lowest, then tackle the card with the highest rate first. "By paying off the balance with the highest interest first, you increase your payment on the credit card with the highest annual percentage rate while continuing to make the minimum payment on the rest of your credit cards," writes Mint.com spokeswoman Hitha Prabhakar.
To make a dent in your debt, you need to pay more than the minimum balance on your credit card statements each month. "Paying the minimum -– usually 2 to 3 percent of the outstanding balance -– only prolongs a debt payoff strategy," Prabhakar writes. "Strengthen your commitment to pay everything off by making weekly, instead of monthly, payments." Or if your minimum payment is $100, try doubling it and paying off $200 or more.
If you have a high-interest card with a balance that you’re confident you can pay off in a few months, Hamm recommends moving the debt to a card that offers a zero-interest balance transfer. "You’ll need to pay off the debt before the balance transfer expires, or else you’re often hit with a much higher interest rate," he warns. "If you do it carefully, you can save hundreds on interest this way."
Have any birthday gifts or old wedding presents collecting dust in your closet? Look for items you can sell on eBay or Craigslist. "Do some research to make sure you list these items at a fair and reasonable price," Karimi writes. “Take quality photos, and write an attention-grabbing headline and description to sell the item as quickly as possible." Any profits from sales should go toward your debt.
If you receive a job bonus around the holidays or during the year, allocate that money toward your debt payoff plan. "Avoid the temptation to spend that bonus on a vacation or other luxury purchase," Karimi writes. It’s more important to fix your financial situation than own the latest designer bag.