Permanent Value

Troubles in Europe Continue to Worry Investors

Michael La Salle
February 26th, 2010

Stocks were slightly lower this week as the S&P 500 lost 0.4% and the Dow Jones Industrial Average fell 0.7%. Debt problems in Europe continued to worry investors as more European countries, including Italy, Ireland, Portugal, and Spain, all joined Greece as countries in the European Union with too much debt. Spain, in particular, has become a bigger immediate issue as a housing bubble is responsible for overbuilding, which in turn is to blame for Spanish banks’ books being overloaded with unsold homes. Spain also boasts an unemployment rate of 18.8%, including 45% of people under-thirty years of age. In earnings news, out of the 456 companies in the S&P 500 who have reported earnings this season, 75% have topped analysts’ estimates. Home Depot and Target both beat analysts’ expectations this week. Lowe’s, the United States second largest home improvement retailer, also beat expectations by posting earnings of 14 cents per share, beating expectations of 12 cents per share.