OBAMA REELECTION PROMPTS SELLOFF
The Dow Jones industrial average plunged more than 300 points on Wednesday – hours after U.S. President Barack Obama was elected to a second term. The Dow shed 312.95 points – or 2.36 percent of its total value – easily its worst single day performance of the year.
Meanwhile the NASDAQ was down 74.64 points (2.48 percent) and the S&P 500 fell 33.86 points (2.37 percent).
The Dow slipped below 13,000 for the first time in two months as investors fretted the impact of Obama’s reelection on tax policy – specifically the possible implementation of broad tax hikes beginning on January 1, 2013 as well as tax hikes associated with Obamacare. They were also greeted by a fresh round of depressing economic data from Europe – specifically a report from the European Commission which projected that the Euro Zone economy would contract by 0.3 percent this year.
That contraction – as well as the stagnation projected for 2013 – impacts American exports (in fact South Carolina is especially susceptible to European economic woes).