TODAY'S TOP STORIES
FONT-SIZE Plus   Neg
Share SHARE
mail  E-MAIL

Stocks Close Mostly Lower Amid Global Economic Worries

Stocks Close Mostly Lower Amid Global Economic Worries
9/24/2012 4:27 PM ET

Stocks ended Monday's trading mostly lower, as traders continued to express concerns about the global economic outlook despite recent announcements of further monetary stimulus. Selling pressure was somewhat subdued, however, limiting the downside for the markets.

While the Dow and the S&P 500 briefly turned positive in late-day trading, the major averages all closed in the red. The Dow dipped 20.55 points or 0.2 percent to 13,558.92, the Nasdaq fell 19.18 points or 0.6 percent to 3, 160.78 and the S&P 500 edged down 3.26 points or 0.2 percent to 1,456.89.

The weakness on Wall Street was partly due to troubling news from overseas, including remarks from an adviser to the People's Bank of China predicting that China's economic slowdown will continue.

Song Guoqing, a Peking University professor, forecast 7.4 percent Chinese GDP growth in the third quarter and 7.3 to 7.4 percent growth in the fourth quarter.

The numbers would represent a continued slowdown from the 7.6 percent growth seen in the second quarter and the 8.1 percent expansion in the first quarter.

Disappointing economic news out of Europe also weighed on the markets, with the Ifo Institute saying its index of German business confidence fell to 101.4 in September from 102.3 in August. The drop surprised economists, who had expected the index to edge up to 102.5.

Highlighting an unexpected drop by the Ifo expectations index, which fell to 93.2 in September from 94.2 in August, Danske Bank said the data clearly signals that Germany is in recession.

Negative sentiment was also generated by news of a disagreement between German Chancellor Angela Merkel and French President Francois Hollande over the timing of the introduction of a banking union.

Among individual stocks, Apple (AAPL) moved to the downside on the day despite announcing that it sold over five million of its new iPhone 5 in the three days after its launch on Friday.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index fell by 0.5 percent, while Hong Kong's Hang Seng Index ended the day down by 0.2 percent.

The major European markets also moved to the downside on the day. While the French CAC 40 Index fell by 1 percent, the German DAX Index dropped by 0.5 percent, and the U.K.'s FTSE 100 Index edged down by 0.2 percent.

In the bond market, treasuries moved moderately higher, extending the upward move that was seen last week. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4.2 basis points to 1.718 percent.

Gold stocks turned in some of the market's worst performances, dragging the NYSE Arca Gold Bugs Index down by 3.1 percent. With the loss, the index pulled back further off the six-month closing high it set last Wednesday.

The weakness among gold stocks came amid a decrease by the price of the precious metal, with gold for December delivery sliding $13.40 to $1,764.60 an ounce.

Considerable weakness was also visible among semiconductor stocks, as reflected by the 1.6 percent loss posted by the Philadelphia Semiconductor Index. Veeco Instruments (VECO) helped to lead the sector lower, plunging by 10.2 percent after Goldman Sachs cut its rating on the stock to Sell.

Oil service stocks also came under pressure on the day amid a continued decrease by the price of crude oil. With crude for November delivery falling $0.96 to $91.93 a barrel, the Philadelphia Oil Service Index dropped by percent.

Computer hardware, biotechnology, and software stocks are also posted notable losses, while trucking railroad stocks bucked the downtrend by the broader markets.

U.S. economic data is likely to attract attention on Tuesday, with reports on home prices and consumer confidence expected to be in focus.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.