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Wall Street Drops for 5th Day
World Economy

Wall Street Drops for 5th Day

US stocks fell for a fifth straight session Thursday as bank results disappointed and investors fretted over the potential impact of global economic weakness on US corporate earnings.
Energy shares extended recent losses as US oil prices settled down more than 4 percent after weak US economic data spurred worries over oil demand. The S&P energy index fell 1.2 percent, Reuters reported.
“We’re probably going to see slowing in the global economy, and it will be very difficult to sail through a global recession without getting touched,” said Scott Colyer, chief executive officer of Advisors Asset Management in Monument, Colorado.
The S&P 500 for the first time in a month ended below 2,000, considered a psychological support level, and closed below its 120-day moving average, suggesting more weakness ahead. The CBOE Volatility index notched a fifth day of gains, up 4.2 percent at 22.39.
Expectations for US fourth-quarter earnings have been scaled back sharply, with growth now estimated at 3.5 percent, compared with an Oct. 1 estimate of 11.2 percent, according to Thomson Reuters data.
The S&P financial sector dropped 1.3 percent. Bank of America lost 5.2 percent to $15.20, among the S&P 500’s biggest drags, after the second-largest U.S. bank by assets reported a 14 percent slump in quarterly profit. Citigroup shares fell 3.7 percent to $47.23 after its results.
The Dow Jones industrial average fell 106.38 points, or 0.61 percent, to 17,320.71, the S&P 500 lost 18.6 points, or 0.92 percent, to 1,992.67 and the Nasdaq Composite dropped 68.50 points, or 1.48 percent, to 4,570.82. After the close, S&P 500 e-minis ESc1 fell further, hitting session lows.
The benchmark S&P 500 is now down 4.7 percent from its Dec. 29 record high. Best Buy shares tumbled 14.1 percent to $34.30 as the worst-performing S&P 500 component. The electronics retailer expects same-store sales growth to be flat to negative in the first two quarters of its fiscal year.
After the bell, shares of Intel dipped 2.1 percent to $35.44 following its results.
In economic news, US producer prices recorded their biggest fall in more than three years in December, while other reports showed mixed signals for manufacturing in New York state and the mid-Atlantic region in January.
About 7.9 billion shares changed hands on US exchanges, above the 7.3 billion average for the last five sessions, according to BATS Global Markets.
NYSE declining issues outnumbered advancers 1,995 to 1,091, for a 1.83-to-1 ratio; on the Nasdaq, 2,152 issues fell and 603 advanced for a 3.57-to-1 ratio.

 

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