Most U.S. Stocks Drop on Economy, Ukraine
New York (Mar 24) U.S. stocks fell for a second day as a report showed slowing growth in manufacturing while European shares slid amid concern the Ukraine crisis may escalate. Gold had its biggest drop of the year.
The Standard & Poor’s 500 Index slipped 0.5 percent to 1,857.44 at 4 p.m. in New York, paring a drop of as much as 0.9 percent. The Nasdaq Composite Index slid 1.2 percent as biotechnology and Internet stocks led losses. The Stoxx Europe 600 Index lost 1.1 percent as world leaders gathered in The Hague. The euro advanced against the dollar and Russia’s ruble strengthened for a second day against the U.S. currency. Yields on 10-year Treasury notes dropped, erasing earlier gains. Gold futures slipped almost 2 percent.
U.S. President Barack Obama arrived in Europe for talks as Russia, which completed its annexation of Crimea last week, masses soldiers on the border with Ukraine. Data today showed the pace of U.S. manufacturing activity slowed this month, while other reports indicated China’s manufacturing industry weakened in March and growth at euro-area factories and service providers held close to the fastest since 2011. China’s leaders have pledged to accelerate policies to support the economy.
“What really spooked people was the U.S. PMI,” Chris Bouffard, chief investment officer with The Mutual Fund Store in Overland Park, Kansas, said in a phone interview. His firm oversees $9 billion. “It’s more of the mixed data and the slower-than-desired economic recovery that just persist. Every time we get a little of momentum, we take a couple steps back with one of the economic readings coming in below expectations.”
Almost three stocks retreated in the U.S. for each that climbed today. The S&P 500 rose 1.4 percent last week as data from jobless claims to manufacturing showed the economy is strengthening after unusually harsh winter weather. The benchmark index reached an intraday record on March 21, touching 1,883.97 before retreating. Reports on housing, gross domestic product and durable goods are among the economic data due this week.
“The market has been running into resistance at 1,880,” Bruce Bittles, chief investment strategist at RW Baird & Co., said by telephone from Sarasota, Florida. His firm oversees $110 billion. “Today it’s a question of what catalyst can come in and generate extra volume.”