November 8th, 2010
09:30 PM ET

Stocks drop; gold surges to record high

A look at highlights from the day's business news:

Stocks step down as gold steps up

Stocks ended lower Monday, as investors took a step back from last week's run-up and shifted their focus to the global economic picture.

The Dow Jones industrial average lost 38 points, or 0.3 percent, to end at 11,406.84. The S&P 500 dropped 3 points, or 0.2 percent, to close at 1,223.25, and the Nasdaq added 1 point to end at 2,580.05.

Instead, investors turned to commodities. Gold surged to a new record high, settling at a record $1,403.20 an ounce, as jittery investors continue to see it as a hedge against inflation.

"After last week's historic events, today is all new territory," said Adam Harter, chief strategist at Financial Enhancement Group. "We have nothing in history to compare last week to, so it's a lot for investors to digest."

Stocks rallied last week on two major pieces of news. Tuesday's midterm elections saw the Republican party win control of the House. On Wednesday, the Federal Reserve said it will buy $600 billion in U.S. Treasuries by the middle of next year to stimulate the economy.

Treasury yields higher following auction

Treasuries came under pressure Monday as investors turned to a bond auction for direction in the absence of major economic reports.

The Treasury Department got an early start to this week's auctions by selling off $32 billion in three-year notes Monday afternoon. Monday's auction was the first since the Fed announced it will purchase $600 billion of Treasuries by the second quarter of 2011.

The three-year note auction drew $104 billion worth of bids, for a bid-to-cover ratio of 3.26, suggesting that demand remains robust. Treasury bond auctions later this week include $24 billion in 10-year notes on Tuesday, and $16 billion in 30-year notes on Wednesday. Bond markets will be closed on Thursday for Veterans Day.

The yield on the benchmark 10-year Treasury note rose to 2.56 percent Monday from 2.54 percent on Friday. Bond prices and yields move in opposite directions.

Yields for the 30-year bond moved higher to 4.14 percent. The two-year note was unchanged at 0.37 percent, and the five-year note ticked up to 1.13 percent.

- reporters Julianne Pepitone and Charles Riley contributed to this report.

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Filed under: Business • Economy
soundoff (22 Responses)
  1. phil

    Your gold isn't worth more. Your money is worth less.

    November 8, 2010 at 9:54 pm | Report abuse |
  2. cesar

    @Phil. Which in turn means your net worth is less, so your are worth less.

    November 8, 2010 at 9:58 pm | Report abuse |
  3. cesar

    @Phil. Which in turn means your net worth is less, so you are worth less.

    November 8, 2010 at 9:58 pm | Report abuse |
  4. tomcat

    @cesar so

    November 8, 2010 at 10:00 pm | Report abuse |
  5. cesar

    @Tomcat. You are freaking funny, dude. I get it. I was hooked on the word "so." I appreciate your come back.

    November 8, 2010 at 10:04 pm | Report abuse |
  6. tomcat

    @cesar so keep posting I enjoy messing with pathetic idiots like you. So think it is so funny

    November 8, 2010 at 10:11 pm | Report abuse |
  7. tomcat

    btw dont mess with Phil either he will drill you a new one. Keep playin azzclown

    November 8, 2010 at 10:15 pm | Report abuse |
  8. cesar

    Never thought I'd see gold at near $1400 an ounce. Wow, some folks are cashing in.

    November 8, 2010 at 10:26 pm | Report abuse |

    i bet you mr.t wish he had waited to cash in those gold necklaces.

    November 8, 2010 at 10:40 pm | Report abuse |
  10. Jim Brieske

    Headed toward a highly devalued dollar this fool president refuses to allow people to suffer because media will see it. The pitfall of modern technology unavailable during The Great Depression is going to cause this I only understand being a successful president (better known as an IOUBS President) to destroy this country because men riding the trains and camping out next to train yards can't be seen on the news.
    In other words, he is going to destroy hard working people's wealth so he looks better when the fact is, he is incapable of handling the situation. He went to India.
    They should have came here and we could have paid for that instead.
    Look how much money would have been saved. Plus there is no God over there to help him. He never should have applied for the job. Got to get him out before he does more damage.
    No more trips. His vacations are just scam jobs destined to destroy our country further. He stays in country from now in. He can go to South Carolina golfing.
    A 2nd Great Depression is coming.

    November 9, 2010 at 1:52 am | Report abuse |
  11. tomcat

    Obama does not have a clue. The Bush bailout did not help his ratings. Lets look back to FDR at least the WPA got folks working. The next step would be an all out war to get the country unified and create jobs. Start with Iran or as the Persians called Aryan.

    November 9, 2010 at 2:37 am | Report abuse |
  12. Jim Brieske

    I want the return of Schwinn bicycle from China announced by the end of Thursday. President Obama can sign an executive order stating the United States of America's manufacturing tax rate is 0 percent. Down from 35 percent. Canada and Erurope have 2 and 5 percent.
    The end of Thursday, Schwinn bicycle returning back from being made in China, it's a disgrace. That's the first and the rest will follow.
    We gotta save this country. This is the best way and there really isn't much choice if anyone disagrees because I am right and because the India trip is designed to do damage later not immediately. They've discovered a poorer group of people than the Chinese. It's called a form of bribery to get money now but in the long run American manufacturing does permanently go to India.
    I want done what I want done. There is no choice.

    November 9, 2010 at 2:43 am | Report abuse |
  13. tomcat

    Leno had a great comment. They evacuated a walmart due to a sucpicous package. It was just a product made in the US. Jim did you see the interview with President Bush and Matt Lauer?

    November 9, 2010 at 2:59 am | Report abuse |
  14. Jim Brieske

    tomcat. You are right. FDR did get people working and out of the Great Depression. Fortunately he had 4 terms. Plus the country was different then. People were really religious. They went to church. If the younger kids missed a Sunday, the old ladies in the neighborhood would verbally attack them from their front porches.
    Then the war started. A war we would have lost if modern day communication technology were available then. Those guys landing at Normandy would have been stopped after the first day's media coverage of the slaughter of our men taking place on the beach. We sacrificed man after man to get in position to take out the German defensive positions.
    All that was possible because those boys went to church and had a firm belief in dying then going to Heaven.
    This country does need direction and having a president who is really untrustworthy is not good. I'm sorry, but he said 8 times that Healthcare debates would be held on CSPAN. I can't disregard that.
    FDR had integrity. Goodnight.

    November 9, 2010 at 3:07 am | Report abuse |
  15. Jim Brieske

    tomcat. No I missed it. I like President Bush. I think Dick Cheney is brilliant. There are things I would to do with Dana Perino that I can't write in this forum. She's hot. Also John McCain's spokeswoman Nancy, oh I forget her last name, but who cares she's gorgeous too and smart as a whip like Perino. Love smart beautiful women. Anyways what was it? The interview.
    My laptop has been on the blink heating up every since I started emailing the Iraniann ambassador warning them to stop their behavior. Tried having Lily Xie in Shanghai fix it. Didn't work. My television I got rid of it. Buying a new laptop the day after Thanksgiving.
    First I have to have my little brother show me how to transfer information.
    I am hoping to watch it on Friday off of Hulu or another website.
    I might break down and spend the extra money on a new laptop sooner. Kinda going nuts without it.
    night again.
    Thanks for reminding me over the interview. Afterall I did get him reelected. Great story. I will tell you sometime.

    November 9, 2010 at 3:27 am | Report abuse |
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