Stocks cough up early gains as volatility returns
Stocks gave up a big gain from earlier in the day Monday and closed down Monday afternoon as Wall Street's recent bout of volatility continued.
After adding more than 200 points earlier in the session, the Dow fell 245 points, or 1 percent, to close at 24,442. The S&P 500 index and Nasdaq also sagged, with technology and communications companies posting some of the biggest losses.
Stocks have plunged since early October, and trading has been especially volatile the last few days. The S&P 500 is down 9 percent this month, which would be its worst monthly loss since February 2009, shortly before the market bottomed during the financial crisis.
Shares of Red Hat, an open-source software company, soared 45 percent to $169.56 after IBM announced plans to buy it for $34 billion. IBM said the purchase, its biggest deal ever, will help the company take the next step in cloud computing. Chairman and CEO Ginni Rometty said the deal will make IBM the world's biggest hybrid cloud provider, meaning it will offer companies a mix of on-site, private and third-party public cloud services. IBM fell 4.8 percent to $118.77.
Earlier on Monday, stocks in Europe also turned sharply higher. Italy's main stock index rallied after Standard & Poor's did not lower the country's credit rating.
German stocks rose even though longtime German Chancellor Angela Merkel said she won't run for another term in 2021. She has been chancellor of Germany for 18 years. The Bovespa in Brazil climbed after far-right politician Jair Bolsonaro was elected president.
Bond prices fell. The yield on the 10-year Treasury note rose to 3.10 percent from 3.07 percent.