Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

U.S. Stocks Slip as Concerns Grow on Growth, Fed Take Hold

02/21/2013 | 02:14pm US/Eastern

--Stocks extend declines midday, as materials, technology shares lag

--DJIA off 81 points, S&P falls 12

--European PMI and Philadelphia Fed data jar investors after Wednesday worries

 
   By Alexandra Scaggs 
 

NEW YORK--Stocks continued to sink midday, after reports of manufacturing pullbacks in the U.S. and Europe were piled on top of investor concerns over the possibility of an earlier-than-expected end to the Federal Reserve's stimulus programs.

The Dow Jones Industrial Average fell 81 points, or 0.6%, to 13846, extending Wednesday's declines. The Standard & Poor's 500-stock index gave up 12 points, or 0.8%, to 1499, as eight of 10 sectors traded in the red and growth-sensitive materials, technology and energy shares weighed. The tech-heavy Nasdaq Composite Index lost 40 points, or 1.2%, to 3125.

Blue chips posted their second-biggest drop of the year Wednesday, as investors were jarred by the potential for an earlier-than-expected end to the Fed's experimental bond-buying programs, known as quantitative easing.

Easing "has been the source of a significant boost for the equity markets," said Natalie Trunow, chief investment officer for equities with Calvert Investments, which oversees $12 billion. "The follow-through [selling] today was on the realization that there is an end to it at some point."

Stocks extended their declines after the Philadelphia Federal Reserve's February index of business activity, an indicator of business conditions for manufacturers in the region, posted a surprise decline to -12.5 from January's -5.8.

"The fact that we are seeing evidence of a continuing slowdown in the manufacturing sector is a bit concerning," said Jim Baird, chief investment strategist for Plante Moran Financial Advisors, which manages $7.2 billion in assets.

Separately, initial claims for unemployment benefits rose to 362,000 in the latest week, more than the 350,000 expected. The consumer price index for January was unchanged on the month, but increased by 0.3% excluding volatile food and energy costs.

Sales of existing homes for January showed a slight increase to a seasonally adjusted annualized rate of 4.92 million, which was mostly in line with expectations. The Conference Board's Leading Economic Index for January gained 0.2%, just below expectations of a 0.3% rise.

Wal-Mart gained 2.6% after the blue-chip discount retailer reported earnings that exceeded analysts' estimates, helping to offset a first-quarter earnings outlook that was below analyst projections.

The losses in U.S. stock futures were more modest than declines in overseas markets.

In Europe, the Stoxx Europe 600 fell 1.5% in response to disappointing economic news for the euro zone. Markit's preliminary composite purchasing-managers' index for the currency bloc fell to 47.3 in February from January's 48.6, and below expectations of 48.5. Readings below 50 indicate contraction. Within the euro zone, Italy's FTSE MIB skidded 3.1% and Germany's DAX slid 1.9%.

The weak data sent the euro down to a six-week low against the dollar. Meanwhile, the dollar sank against the yen.

Asian markets also suffered steep declines, highlighted by a 3% tumble in China's Shanghai Composite, the biggest percentage decline seen since November 2011. Exacerbating worries about the Fed easing up on its stimulus program, China's State Council said on Wednesday that it would continue with market controls to curb increases in property prices.

Japan's Nikkei Stock Average shed 1.4% and Australia's S&P ASX 200 dropped 2.3%.

Gold futures edged up 0.1% to $1,579.60 a troy ounce. Crude-oil futures lost 2.1% to $93.21 a barrel. Yields on the benchmark 10-year U.S. Treasury note fell to 1.966% as prices rose.

Tesla Motors skidded 9.9% after the electric-car maker reported a wider-than-anticipated fourth-quarter loss and revenue that rose less than expected. Gross margin narrowed sharply.

Dow component Hewlett-Packard was mostly flat. Its fiscal first-quarter results are to be released after the closing bell.

Carlyle Group slumped 7.6% after it missed analyst estimates for its earnings and revenue. The private-equity firm recorded lower performance fees and recorded an investment loss.

VeriFone Systems tumbled 40%. The electronic-payments company indicated that fiscal first-quarter earnings and revenue would fall well short of expectations, citing weak economic conditions in Europe and delayed projects from several major customers. It also provided a downbeat outlook for the current quarter.

Pegasystems surged 8.2% after the business process-management company reported earnings and revenue that were much better than expected. It provided a 2013 outlook that was above current projections.

Hormel Foods rose 1.7%. The company reported fiscal first-quarter earnings and revenue in line with analyst estimates and raised its full-year earnings outlook to reflect the benefit of buying the Skippy peanut-butter business last month.

-Write to Alexandra Scaggs at alexandra.scaggs@dowjones.com

Latest news
Date Title
<1m ago BOUSTEAD SINGAPORE : Acquisition of Subsidiary in Indonesia
<1m ago SEYMOUR WHYTE : SWL Secures $130 Million in New Contracts
<1m ago AFRICAN ENERGY RESOURCES GUERNSEY : Appendix 3B - First Quantum Minerals Placement
<1m ago AFRICAN ENERGY RESOURCES GUERNSEY : s708 ASIC Cleansing Notice
<1m ago IMUGENE : Resignation of Director
<1m ago WGGA WINEGRAPE GROWERS' AUSTRALIA : presentation at WFA Outlook Conference
1m ago NATIONAL AGRICULTURAL : Study Results from National Agricultural and Food Research Organization in the Area of Molecular Biology Reported (Co-modification of class B genes...
1m ago Study Results from K.J. Shin and Colleagues in the Area of Integrative Anatomy and Evolutionary Biology Reported (Three-Dimensional Study of the...
4m ago Study Data from Texas A&M University Update Understanding of Horticultural Science (Detection of DNA and Ploidy Variation within Vegetatively...
6m ago STUDIES FROM UNIVERSITY OF THE RYUKYUS UPDATE CURRENT DATA ON HEREDITY RESEARCH (FUKUSHIMA'S BIOLOGICAL IMPACTS : The Case of the Pale Grass Blue...
Latest news
Advertisement
Hot News 
BOULDER BRANDS : Announces Preliminary Third Quarter 2014 Results
TUPPERWARE BRANDS : Reports Third Quarter Results
WILLBROS : Elects John T. McNabb, II Chief Executive Officer
CLICKSOFTWARE TECHNOLOGIES : Appoints New CFO
ALTISOURCE PORTFOLIO SOLUTIONS : INVESTOR ALERT: Glancy Binkow & Goldberg LLP Reminds Investors of the Lead Plaintiff Deadline in the Class Action Lawsuit Against Altisource Portfolio Solutions S.A.
Most Read News
2h ago AT&T revenue misses forecasts as more customers bring own phones
4h ago TERADYNE : beats Street 3Q forecasts
4h ago EXELON : ICC Approves ComEd’s Grand Prairie Gateway Project
4h ago ATMEL : Patent Issued for Apparatus and Method for Increasing the Quantity of Discrete Electronic Components in an Integrated Circuit Package
1h ago NORTHFIELD BANCORP : Announces Third Quarter 2014 Results
Most recommended articles
9m ago China flash HSBC PMI edges up in October but output at five-month low
28m agoDJSome EU States Seek Sops for Climate-Change Goals
28m ago AUD/USD Compression Continues As Candlesticks Indicate Indecision
29m agoDJAGL Says Carbon Tax Repeal to Hit Profits
48m agoDJU.K. Car Production Sees Biggest Nine-Month Rise in Six Years
Dynamic quotes  
ON
| OFF