Log in
Login
Password
Remember
Lost password
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

U.S. Stocks Slide Amid Europe Concerns; Tech Shares Weigh

02/04/2013 | 03:58pm US/Eastern

--Major benchmarks slump amid concerns over Europe

--Dow threatens first triple-digit point decline in 2013

--Technology stocks weigh on major benchmarks

 
   By Chris Dieterich and Matt Jarzemsky 
 

NEW YORK--The Dow Jones Industrial Average slumped Monday toward its first triple-digit drop this year, as weakness in technology stocks helped derail a five-week rally for the blue chips.

The Dow sank 106 points, or 0.8%, to 13904 in late-afternoon trading. Monday's decline followed the Dow closing above 14000 for the first time since October 2007 Friday, having climbed 6.9% so far in 2013.

"What we're dealing with is that we've had quite a run higher, and it follows that it's time to digest some of those gains," said Brian Lazorishak, portfolio manager and quantitative analyst at Chase Investment Counsel.

The Standard & Poor's 500-stock index lost 14 points, or 0.9%, to 1498. All 10 S&P 500 sectors lost ground, with particular weakness in technology shares. Oracle Corp. dropped 2.7% after agreeing to buy Acme Packet Inc., which makes telecommunications equipment, in a deal valued at $1.7 billion.

The technology-oriented Nasdaq Composite Index fell 38 points, or 1.2%, to 3141. Facebook Inc. fell 5.1%, continuing a slide that began last week, after its shares hit their highest level since July.

Broad declines in the U.S. followed those in Europe, where the Stoxx Europe 600 shed 1.5%. Spanish and Italian bond yields rose, and stocks from those countries declined sharply, on concerns about political graft and Italy's banking sector.

Spain's IBEX 35 index slid 3.8%, while Italy's FTSE MIB slumped 4.5%. Spanish Prime Minister Mariano Rajoy moved to contain a scandal over alleged cash payments to him. In Italy, weakness in bank stocks was compounded by a criminal investigation into derivatives trading.

"In the short run, a lot of the people who were ready and willing to buy stocks have already done so," said Bill Stone, chief investment strategist at PNC Asset Management Group. "And, in the backdrop today, the market is revisiting the jitters in Europe," he said.

Asian markets were mostly higher after data released over the weekend showed a continued expansion in China's services sector in January. China's Shanghai Composite rose 0.4%, and Japan's Nikkei Stock Average gained 0.6%.

In U.S. economic news, orders for manufactured goods rose in December, according to the Commerce Department, but its 1.8% increase was shy of a 2.2% rise expected by economists.

Stock-rating downgrades from analysts pressured a trio of Dow heavyweights. Drug maker Merck & Co. was among the worst performers on the Dow, falling 1.9% after analysts at Morgan Stanley cut their rating on the stock, voicing pessimism about the company's drug pipeline.

Wal-Mart Stores Inc. fell 1.1% after analysts at J.P Morgan Chase cut the retailer's stock rating to "neutral" from "overweight," noting that the recent expiration of payroll-tax cuts could hamper sales growth.

Chevron Corp. fell 0.6% after analysts at UBS cut its stock recommendation, noting that the stock no longer looks cheap after gains of nearly 10% over the past 12 months.

In other corporate news, Clorox Co. rose 1% after the consumer-products company reported that improved sales and price increases drove profit margins higher, and it issued an optimistic estimate for its full-year earnings.

McGraw-Hill Cos. tumbled 11%, leading the S&P 500 lower, after reports that the Justice Department and state prosecutors plan to file civil charges alleging wrongdoing by the company's Standard & Poor's Ratings Services business. S&P said the potential lawsuit, involving its rating of mortgage bonds before the financial crisis erupted in 2008, was "entirely without factual or legal merit."

Gannett Co. slumped 5.6% after the publisher of USA Today and other newspapers saw its quarterly earnings fall 12%. The company's print-advertising revenue continued to fall, while revenue perked up in digital subscriptions.

Shares of Herbalife Inc. dropped 0.8% after the New York Post reported the company may be under investigation by the Federal Trade Commission. In a statement issued Monday afternoon, Herbalife described the report as "misleading and inaccurate information" and called on the Post to issue a correction. Herbalife's shares fell as much as 12% earlier.

Health insurer Humana Inc. was up 4.6%, the best-performing stock on the S&P 500, after posting fourth-quarter earnings that topped estimates.

Sysco Corp. declined 2.5% after the food-services distributor posted higher restructuring-related charges, offsetting benefits of increased sales in the most recent quarter.

Front-month March crude-oil futures fell 1.6% to $96.17 a barrel, while February gold futures rose 0.4% to settle at $1,675.30 a troy ounce. The dollar rose against the euro but slipped against the yen. Yields on benchmark 10-year Treasury notes fell to 1.973% as demand rose.

Write to Chris Dieterich at christopher.dieterich@dowjones.com and Matt Jarzemsky at matthew.jarzemsky@dowjones.com

React to this article
Latest news
Date Title
06:54a THOMSON REUTERS : Islamic finance assets to grow 80% by 2020
06:53a CHINESE PEOPLE : China celebrates V-Day
06:53a CLOUD STORAGE MARKET 2015 : Primary Storage Solution, Backup Storage Solution, Cloud Storage Gateway Solution, and Data Movement and Access Solution - Global Forecast and Analysis to 2020
06:52a CHOW TAI FOOK JEWELLERY : unveils the Cullinan Masterpiece: "A Heritage in Bloom" Entrusted Creation to World-renowned Jewellery Artist Wallace Chan One of the Rarest Diamond Masterpieces to Emerge from Contemporary China Embodies 's Heritage as a Diamond Expert
06:52a TATA MOTORS : and Tata Technologies Announce ENGAGENEXT iSourcing, to Optimize Capabilities, Accelerate New Product Development
06:52a ROFIN SINAR TECHNOLOGIES : -SINAR to Participate in the “6th Annual Credit Suisse Small & Mid Cap Conference”
06:52a GRUPPA CHERKIZOVO PAO : A common space
06:49a BYD : Showcases Its EV strength at Beijing's World War II Military Parade
06:48a RESEARCH AND MARKETS : France & Benelux Cinema Industry Report 2015
06:48a RESEARCH AND MARKETS : Atopic Dermatitis - Pipeline Review, H1 2015
Latest news
Advertisement
Hot News 
FORBIDDEN TECHNOLOGIES : Reports Loss In Half As Deferred Revenue Rises
Earnings, Trading Statements Calendar - Week Ahead
Integra LifeSciences to Acquire Total Ankle Replacement (Salto Talaris(R)) and Silastic Toe Replacement (Futura(TM)) Product Portfolios From Tornier N.V.
EMPRESARIA : Expects Annual Results To Beat Current Market Expectations
MARIMEDIA : Interim Results 2015
Most Read News
09/02 AUSTRALIAN COMPETITION AND CONSUMER COMMISSION : ACCC concludes review of 'free range' and other similar claims in the pork industry
09/02 MRB MALAYSIAN RUBBER BOARD : Courtesy Visit By H.E Thai Ambassador to Malaysian Rubber Board
09/02 CEPA CANADIAN ENERGY PIPELINE ASSOCIATION : Do your beliefs about pipelines stand up to the science?
09/02 MRB MALAYSIAN RUBBER BOARD : Director General Attends Deputy Minister’s Hari Raya Aidil Fitri Celebration
09/02 HARRINGTON GLOBAL LIMITED : Acquires Securities of Range Energy Resources Inc.
Most recommended articles
06:47aDJBoeing, Jet2.com Finalize Order For 737s
06:46aDJImpala Platinum To Raise Cash to Repair Finances
06:46aDJGlencore, Other Miners Rally on Commodity Prices Rebound
06:36a BRITISH LAND : retail investors pour $3 billion into equity funds, highest in 15 years
06:33a HSBC : says to rebrand British retail arm 'HSBC UK'