U.S. stocks broadly lower, Oracle plunges; Dow falls 0.4%

Investing.com - U.S. stock markets were broadly lower after the open on Wednesday, as risk sentiment was dented after a refinancing operation by the European Central Bank failed to ease investor concerns over the debt crisis in the euro zone.

During early U.S. trade, the Dow Jones Industrial Average fell 0.4%, the S&P 500 index dropped 0.55%, while the Nasdaq Composite index tumbled 1.6%.

The ECB allotted EUR489.2 billion to 523 European lenders in its first offer of unlimited three-year loans earlier in the day, exceeding expectations for a total amount of EUR391 billion.  

U.S. stock futures initially spiked higher following the news, tracking strong gains in European equities.

However, the move failed to alleviate concerns over the financial crisis in the region as the scale of the operation indicated that European lenders believe that funding shortages were likely to continue into 2012.

Shares in U.S. lenders retreated after the open, with Bank of America slumping 1%, while investment banks Morgan Stanley and Goldman Sachs fell 1.25% and 1.4% respectively.

Meanwhile, shares in technology giant Oracle plunged 14%, the biggest intraday drop since March 2002 after reporting lower-than-expected second earnings for the first time in a decade after Tuesday’s closing bell, as software and hardware sales declined.

The downbeat earnings weighed heavily on other shares in the sector, with IBM shares down 3.5% and U.S.-listed shares of German software giant SAP dropping 5.7%.

Shares in drugstore chain Walgreen’s tumbled 7.1% after reporting a 4.5% drop in first quarter profit, due in part to a slow flu season and its decision to leave the Express Scripts pharmacy network next month.

On the upside, Blackberry-maker Research in Motion rallied 7.6% on reports that Microsoft and Finnish mobile-phone company Nokia have “flirted” with the idea of making a joint bid for the company in recent months.

Athletic apparel giant Nike saw shares gain 1.85% after reported better-than-expected fiscal second quarter profit and sales, as sales in China grew 35%.

Meanwhile, across the Atlantic, European stock markets were broadly lower. The EURO STOXX 50 declined 0.45%, France’s CAC 40 slumped 0.55%, Germany's DAX shed 0.3%, while Britain's FTSE 100 fell 0.8%.

Earlier in the day, the National Association of Realtors said that existing home sales rose by 4% to a seasonally adjusted 4.42 million units in November, falling significantly short of expectations for a gain of 15.5% to 5.03 million units.

Existing home sales in October was revised down by nearly 14% to 4.25 million units from a previously reported 4.97 million.