Market Summary

Stocks fell sharply Tuesday as blue chip stocks lowered guidance, while financials slumped on debt worries. Equities faced pressure from a climb in the U.S. dollar and a dip in commodities. The markets opened negative, and closed out the day near their lows of the session. Energy, financials, consumer staples all had a rough going.

The Dow Jones industrial average fell 104.14 points, or 1.00 percent, at 10,285.97. The Standard & Poor’s 500 Index closed down 11.31 points, or 1.03 percent, at 1,091.94. Tech was the best performer as the Nasdaq Composite Index lost 16.62 points, or 0.76 percent, at 2,172.99.

Benchmark crude for January delivery dropped $1.31 to settle at $72.62 a barrel on the NYMX; it’s fifth day of declines.

3M Company (MMM) gave a 2009 outlook that fell short of Wall Street’s consensus and provided investors with a cautious initial view of its 2010 earnings. McDonald’s Corporation (MCD) said sales at its established U.S. restaurants dipped in November as competitors pushed low prices to bring in consumers

ISM Manufacturing Forecast

The Institute for Supply Management released their semiannual economic forecast. Economic growth in the United States will resume in 2010, with manufacturing revenue forecast to rise 5.7 percent. Capital expenditures in manufacturing are expected to fall, but with the decline improving to 4 percent next year from a drop of 7.8 percent in 2009.
Revenue in the non-manufacturing sector is expected to increase by 1.3 percent in 2010, while capital expenditures in the services sector will decrease by 6.7 percent.

Manufacturers expect employment in their sector will increase by 1.5 percent, while labor and benefits costs are expected to increase an average of 1.4 percent in next year.

A Little Commercial Real Estate Acquisition

The Simon Property Group has agreed to buy Prime Outlets from the Lightstone Group for $2.235 billion, adding 22 retail outlets to its portfolio. Under the terms of the deal announced Tuesday, Simon’s consideration for Prime Outlets will consist of 80 percent cash and 20 percent stock.

Simon the largest mall operator, has arranged a $3.565 billion line of credit that can expand up to $4 billion; led by JP Morgan Chase Co (JPM) and Bank of America Inc (BAC)