Now that the Dow Jones Industrial Average‘s 10-day winning streak is over, the index appears to be working on a losing streak. After falling 25 points on Friday, the Dow is down another 18 points, or 0.13%, as of 12:55 p.m. EDT.
On Friday, it appeared investors were ready for the streak to end, as they took money off the table and locked in profits. But today, a stressed world financial system is leading the markets lower following a controversial decision in the small country of Cyprus.
On Saturday, the European Union bailed out Cyprus, which really didn’t make world news. But what did make headlines is the fact that part of the bailout will be paid for by the country’s bank deposits. The deal imposes a tax on all checking and savings deposits within the country. This breaks the long-held rule that bank deposits are untouchable and the “safest” place to store your money.
Cyprus’ government still needs to vote on the bailout deal, but the distant threat of bank runs not only in Cyprus but throughout Europe has the markets moving lower.