Wednesday, April 17, 2013

Wall Street posts worst day since November 7 on gold's drop, Boston blasts

By Caroline Valetkevitch

NEW YORK (Reuters) - U.S. stocks posted their worst day since November 7 on Monday as big declines in the price of gold, oil and other commodities fed a broad selloff in equities.

Weaker-than-expected data from China sparked the initial decline, but selling accelerated late in the session as reports of two explosions in Boston near the finish line of the Boston Marathon unnerved investors.

Commodity-related shares led stocks' losses, with gold suffering its worst two-day sell-off in 30 years as the China data fueled worries about the strength of the global economy. The SPDR Gold Shares ETF lost 8.8 percent to $131.31 on record volume.

Total trading volume was the second highest of the year, with about 8.5 billion shares changing hands on U.S. exchanges.

Analysts said the stock market had been vulnerable to a pullback, given the sharp gains since the start of the year as well as the Dow's and the S&P 500's recent record highs. The S&P 500 is still up 8.8 percent for the year.

"I don't think the market has much tolerance for bad news," said Uri Landesman, president of Platinum Partners in New York.

"There was a bad Chinese GDP number, which I think spooked people to start, and technical factors. Profit-taking started taking over. Late in the day, we were getting hit by reports that there were explosions in Boston. That gets people nervous."

At least two were killed and dozens were injured from the blasts.

The Dow Jones industrial average sank 265.86 points, or 1.79 percent, to close at 14,599.20. The Standard & Poor's 500 Index fell 36.49 points, or 2.30 percent, to 1,552.36. The Nasdaq Composite Index lost 78.46 points, or 2.38 percent, to end at 3,216.49.

It was the biggest daily percentage drop for all three indexes since November 7, when the market sold off following the U.S. presidential election.

The biggest declining sectors were energy and materials. The S&P energy sector index lost 3.9 percent. The S&P materials sector index <.splrcm> also fell 3.9 percent.

Exxon Mobil fell 2.8 percent to $86.49 and led the S&P 500's decline, while shares of miner Freeport-McMoRan Copper & Gold Inc tumbled 8.3 percent to $29.27.

Data showed China's annual rate of growth eased back to 7.7 percent from the 7.9 percent rate of the previous quarter and below economists' forecast for an 8.0 percent expansion.

"The adverse feedback loop of all these things, particularly margin calls perhaps with gold, that's spilling over to stocks, and that's something most investors don't want to get in front of, so we've seen selling really dominate the day today," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

The CBOE Gold ETF Volatility Index <.gvz>, which measures the market's expectation of 30-day volatility of gold prices by applying the VIX methodology to options on SPDR Gold Shares, shot up 61.7 percent - its largest percentage gain in its history. The index, often called the Gold VIX, hit a fresh 52-week high at 35.39.

Other stock decliners included Dish Network , which fell 2.3 percent to $36.77 after the No. 2 U.S. satellite television provider offered to buy Sprint Nextel Corp for $25.5 billion in cash and stock. Sprint shares jumped 13.5 percent to $7.06.

The offer could thwart the proposed acquisition of Sprint by Japan's SoftBank Corp .

Among the day's gainers, Citigroup shares edged up 0.2 percent to $44.87 after reporting a higher-than-expected gain of 31 percent in first-quarter profit.

First-quarter reports are expected to show only a small year-over-year gain in overall earnings since growth has slowed in recent quarters. S&P 500 earnings growth is estimated at 1.7 percent, based on results from 34 companies that have reported results so far and estimates for the rest, Thomson Reuters data showed.

Decliners outnumbered advancers by a ratio of more than 7 to 1 on both the NYSE and the Nasdaq.

(Additional reporting by Leah Schnurr and Doris Frankel; Editing by Kenneth Barry, Nick Zieminski and Jan Paschal)

Source: http://news.yahoo.com/nasdaq-drops-2-percent-wall-street-extends-losses-192157746--finance.html

woodward keratosis pilaris rock and roll hall of fame 2012 brandon rios oklahoma news nascar news doppler radar

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.