All 10 categories in the S. P. 500 slumped as companies most tied to economic growth had the biggest declines.
The S. P. 500 retreated 28.98 points, or 2.5 percent, to 1,131.42, on Friday, wiping out earlier gains this week as the index extended losses in the last hour of trading.
The Dow Jones industrial average lost 240.60 points, or 2.16 percent, to 10,913.38, while climbing 1.3 percent for the week. It was down 12 percent in the quarter.
The Nasdaq composite index fell 65.36 points, or 2.63 percent, to 2,415.40, on Friday, and declined 13 percent in the third quarter.
“It’s an accumulation of worries that keep dragging the market down,” said John Carey, a Boston-based money manager at Pioneer Investments. “The economic news continues to be mixed and there’s still worry about the European debt situation and concern about our own political impasse in Washington.” He added, “News like that definitely rings alarm bells for people and makes them more cautious about equities.”
The S. P. 500 rose 0.8 percent on Thursday as lower-than-estimated claims for unemployment benefits helped offset losses in consumer and technology shares. The index dropped for five consecutive months, the longest falling streak since March 2008. The gauge tumbled 14 percent this quarter, the biggest three-month drop since December 2008, and is down 10 percent for the year.
Equities fell as a Commerce Department report showed consumer spending slowed in August. Purchases rose 0.2 percent after a revised 0.7 percent gain in July. Incomes fell 0.1 percent, missing economists’ projection of a 0.1 percent increase.
Stocks pared declines as confidence among consumers rose in September from the lowest level since November 2008. The University of Michigan’s consumer confidence index for the month was 59.4, up from a preliminary reading issued two weeks ago of 57.8 and from 55.7 in August. The Institute for Supply Management-Chicago’s business barometer rose to 60.4 in September from 56.5 in August.
Global equities fell after a report showed that a gauge of Chinese manufacturing shrank for a third month, the longest contraction since 2009, as measures of new orders and export demand declined. The reading of 49.9 for the September purchasing managers’ index, released by HSBC Holdings and Markit Economics, was unchanged from August and compared with a preliminary 49.4 figure published last week.
“It seems like cautious trading right now with few new longs or shorts on quarter end,” Larry Peruzzi, senior equity trader at Cabrera Capital Markets in Boston, wrote in an e-mail. “We saw two reports, the Michigan confidence report and the Chicago P.M.I., come in better than both estimates and previous month’s reading. This helped slow the bleeding but it does feel like a nervous market.”
Industrial, commodity and financial companies lost at least 3.2 percent each for the biggest drops among 10 S. P. 500 groups. Alcoa shares fell 4.9 percent, to $9.57. Stock in General Electric lost 4 percent, to $15.22. Halliburton dropped 5.4 percent, to $30.52, after the price of oil capped its biggest quarterly loss since the 2008 financial crisis.
American Express shares fell 3.9 percent, to $44.90. JPMorgan Chase declined 4.1 percent, to $30.12. Financial companies in the S. P. 500 declined 23 percent in the quarter.
Two industries that have beaten the S. P. 500 in the third quarter, computer and software makers as well as companies reliant on discretionary consumer spending, had the biggest declines Thursday and extended losses Friday. The S. P. 500 information technology index lost 2.8 percent, bringing its three-day drop to 4.6 percent. Discretionary companies erased 2.8 percent and fell 5.3 percent in the last three days.
Micron Technology, the nation’s largest maker of computer-memory chips, reported an unexpected loss of 14 cents a share for its fourth fiscal quarter on weak demand for personal computers.
Ingersoll-Rand, which makes products like Club Car golf carts and Schlage locks, forecast third-quarter earnings to be no more than 80 cents a share, below an earlier prediction of at least 85 cents and missing the average analyst estimate of 92 cents. Its stock declined 12 percent, to $28.09.
The Treasury’s 10-year note rose 25/32 to 101 28/32. The yield fell to 1.92 percent, from 2 percent late Thursday.
Article source: http://www.nytimes.com/2011/10/01/business/daily-stock-market-activity.html?partner=rss&emc=rss
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