Stocks dropped sharply on European political uncertainty and another sign of a slowdown in the Chinese economy. Investors reacted to news that French President Nicolas Sarkozy came in second place in the first round of elections there behind Socialist candidate Francois Hollande, who has been openly hostile to EU austerity measures. Plus, the Dutch prime minister, Mark Rutte resigned, putting that country's prized AAA rating in jeopardy. Also, Wal-Mart fell 4.7% after the New York Times reported that top executives at a subsidiary allegedly undertook a large-scale bribery campaign to construct stores across Mexico. Kellogg plummeted 6% after the cereal company cut its outlook citing the slowdown in Europe. Tech stocks followed the broad-based retreat with Netflix and Texas Instruments, losing 4.02% and 1.79% respectively, among the notable decliners ahead of those companies’ quarterly results. Apple slid 0.22% ahead of its earnings report. Also, Facebook announced that it would spend $550 million to buy part of Microsoft's patent portfolio that it acquired from AOL two weeks ago for $1 billion. After the closing bell Netflix dropped 15% following a smaller-than-expected quarterly loss. Texas Instruments advanced 3.5% after the co.’s quarterly earnings and sales surpassed expectations. Implied volatility inched higher on huge trading volumes.
