Stocks slide on conflicting signs about economy
NEW YORK — Investors pulled away from stocks again Monday as conflicting signs emerged about the direction the economy is taking.
Oil prices fell as traders bet that continued weakness in the economy would crimp demand. But stocks pulled off their lowest levels after a trade group reported that its index of services industry activity rose to its best level in nine months in June.
Investors are cautious after a strong rally in stocks since March, fearing that they might have been too optimistic in their expectations about how soon the economy can recover from the recession that began in December 2007.
Oil fell about 2.5 percent on the growing belief that the economy won’t be strong enough to lift demand for energy as much as had been expected. Last week, oil hit an eight-month high above $73.
In other economic news, the Institute for Supply Management’s services index rose to 47 in June from 44 in May. Economists polled by Thomson Reuters had expected a reading of 45.5.
The better-than-expected report wasn’t enough to assuage the growing doubts about the economy following disappointing reports last week on consumer confidence and deep job cuts for June.
“There is a sense that the fundamentals in the marketplace haven’t caught up with the technical rally that we got in March,” said Dan Deming, a trader with Strutland Equities in Chicago.
In early afternoon trading, the Dow Jones industrial average fell 22.07, or 0.3 percent, to 8,258.67. The broader Standard & Poor’s 500 index fell 5.26, or 0.6 percent, to 891.16. The Nasdaq composite index fell 23.88, or 1.3 percent, to 1,772.64.
Oil fell $2.21 to $64.52 on the New York Mercantile Exchange.
The market has relatively few guideposts to give it direction this week ahead of second-quarter earnings reports, which get under way on Wednesday with Dow component Alcoa Inc. but don’t pick up speed until next week.
The drop in oil and other commodities hit energy and materials stocks. Exxon Mobil Corp. fell 82 cents, or 1 percent, to $67.67, and Occidental Petroleum Corp. fell $2.12, or 3.4 percent, to $61.16.
Alcoa fell 80 cents, or 8.1 percent, to $9.06, while Freeport-McMoRan Copper & Gold Inc. fell $4.01, or 8.1 percent, to $45.72.
Technology shares slid as investors moved into areas that could provide safety in a struggling economy. Oracle Corp. fell 47 cents, or 2.2 percent, to $20.57, while Apple Inc. fell $3.47, or 2.5 percent, to $136.55.
Consumer goods producer Colgate Palmolive Co. rose $2.15, or 3 percent, to $74.23.
The market reached a plateau in mid-June, mainly holding on to the gains it notched this spring, but desperately needs more confirmation of an economic recovery before moving higher again. The upcoming earnings season and any forecasts companies make about the rest of the year are sure to answer questions about where the market goes next.
In corporate news, a judge ruled that General Motors Corp. can sell the bulk of its assets to a new company, potentially clearing the way for the automaker to emerge from bankruptcy protection.
U.S. markets are catching up after being closed Friday for the July Fourth holiday. On Thursday, stocks fell sharply in response to the Labor Department employment numbers, pushing major indexes down more than 2 percent.
More than two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 520.2 million shares, compared with 357.7 million traded at the same point Thursday.
The Russell 2000 index of smaller companies fell 7.78, or 1.6 percent, to 489.43.
Bond prices fell, pushing yields slightly higher. The yield on the benchmark 10-year Treasury note rose to 3.52 percent from 3.50 percent late Thursday. The yield on the three-month T-bill rose to 0.16 percent from 0.15 percent late Thursday.
The dollar was mixed against other major currencies, while gold prices also rose.
Overseas, Japan’s Nikkei stock average fell 1.4 percent. Britain’s FTSE 100 fell 1 percent, Germany’s DAX index fell 1.2 percent, and France’s CAC-40 slid 1.1 percent.
Related News
Treasury prices falter for 2nd day as latest data on labor market spurs more buying of stocksSeptember 4th, 2009 Treasury prices fall as stocks move higherNEW YORK — Treasury prices fell for a second straight day Friday as buying picked up on Wall Street after a mixed report on the labor market. Stock prices rose Friday, putting pressure on bonds, after the Labor Department said job losses slowed last month to their lowest level in a year.
US stocks little changed after jobs report; global markets riseAugust 20th, 2009 Stocks little changed at Wall Street openNEW YORK — Stocks are little changed in early trading, with investors wary of making big moves after a worse-than-expected weekly jobs report. The Labor Department says new claims for unemployment benefits jumped unexpectedly to 576,000 last week.
Oil loses gains to fall below $67 in afternoon European trading amid mixed economic dataAugust 18th, 2009 Oil below $67 amid mixed economic signalsVIENNA — Oil prices gave up early gains to slip back below $67 a barrel Tuesday as investors weighed mixed signals about the strength of the global economic recovery. Benchmark crude for September delivery was down 41 cents to $66.30 a barrel in afternoon European trading on the New York Mercantile Exchange.
US stocks decline pushes indices lower for the weekAugust 15th, 2009 NEW YORK - US stocks closed lower Friday, pushing the major indices into negative territory for the week amid mixed signals on the prospects for the country's struggling economy. A surprising fall in a consumer confidence survey by the University of Michigan and Reuters dragged on investors' minds.
US stocks mixed on better-than-expected GDP figuresAugust 1st, 2009 NEW YORK - US stocks closed mixed Friday to end one of its best months in years, after government figures showed a smaller-than-expected contraction of the world's largest economy in the second quarter of the year. The economy shrank at a 1-percent annual rate April-June period, according to a preliminary estimate by the US Commerce Department.
Stocks open slightly lower after mixed earnings; investors await new home sales updateJuly 27th, 2009 Stocks slip at open amid mixed earningsNEW YORK — Stocks are slightly lower in early trading Monday amid a handful of mixed earnings reports. RadioShack Corp., like many other companies, said its second-quarter earnings rose as it cut costs.
Oil above $65 in noon European trading as traders watch stocks after mixed US investory dataJuly 23rd, 2009 Oil above $65 after mixed US inventory dataVIENNA — Oil prices remained above $65 a barrel on Thursday as traders looked to stock markets for direction after U.S. crude inventory data gave mixed signals on demand.
Stocks mostly fall on mixed signals about economy, oil slides; Services report tops forecastsJuly 6th, 2009 Stocks mostly fall as traders search for directionNEW YORK — Investors pulled away from stocks again as conflicting signs emerged about the direction the economy is taking. Stocks mostly fell Monday, led by energy and materials companies, as prices for oil and other commodities skidded.
Stocks lose ground following mixed reports on manufacturing, factory ordersMay 1st, 2009 Stocks fall on mixed manufacturing, factory dataNEW YORK — Stocks are slipping following mixed data on manufacturing and factory orders. The Institute for Supply Management's manufacturing index contracted at a slower pace in April.
Stocks lose ground following mixed data on manufacturing, factory orders, corporate earningsMay 1st, 2009 Stocks fall on mixed economic data, weak earningsNEW YORK — Stocks began May with moderate losses following mixed data on manufacturing and factory orders and weaker-than-expected earnings reports. Wall Street, coming off its best month in nine years, has been growing more optimistic the economy is stabilizing.
Gold prices retreat, fall back below $900 as dollar gains ground, stocks stage early rallyApril 30th, 2009 Gold falls as stocks stage early rallyNEW YORK — Gold prices inched back below $900 an ounce on Thursday, falling as the dollar advanced against other major currencies and stocks staged an early rally. Other commodities, like oil and grain futures, finished higher.
Stocks fluctuate in narrow range as consumer confidence blows past analyst forecasts in AprilApril 28th, 2009 Jump in consumer confidence gives boost to stocksNEW YORK — Investors are setting aside some of their worries about the economy as a closely watched measure of consumer confidence soars in April. Stocks had been lower on worries about fallout from the swine flu and banks that may need to raise capital following government "stress tests."
But a midmorning report showing a surge in consumer confidence tempered those concerns.
Stocks fall in early trading as Morgan Stanley results fall short of expectationsApril 22nd, 2009 Lackluster earnings reports send Wall Street lowerNEW YORK — Investors unnerved by mixed news from corporate earnings reports sent stocks lower in early trading Wednesday. Morgan Stanley reported a wider-than-expected loss for the first quarter and reduced its dividend.
Financial stocks up in mixed day on Wall StreetApril 14th, 2009 NEW YORK - A banking rally has helped US stocks make limited gains after mixed trading which began with poor earnings forecasts from planemaker Boeing Co and energy giant Chevron Corp. Financial stocks climbed 4.8 percent Monday, led by Citigroup Inc and Bank of America Corp as many in the sector prepared to release quarterly earnings this week.
US stocks fall on shrinking economy, disappointing earningsJanuary 30th, 2009 NEW YORK - US stocks fell for a second session Friday morning as US gross domestic product (GDP) fell by the highest rate in 27 years and disappointing earnings added to the uncertainty in the market. The US Commerce Department reported Friday that the GDP, which measures total goods and services output in the country, contracted at a 3.8 percent annual rate, the lowest level since the first quarter of 1982.
Loading ...