Stocks Fall on Weak Durable Goods Data

NEW YORK - Stocks pulled back Wednesday after the government's February durable goods report injected more pessimism about the economy into the market.

The Commerce Department said durable goods orders fell 1.7 percent last month, the second straight monthly decline in the economic indicator. The market had expected orders to go up.

The disappointing report comes a day after the broader stock market extended its gains following two sessions of sharp advances. Considering that the blue-chip Dow Jones industrial average has risen more than 425 points in the past three sessions, a pullback does not come as a surprise, particularly after the weak durable goods numbers.

What remains unclear, however, is how much Wednesday's economic data will end up eroding the market's recent rally.

The Commerce Department reported Wednesday that sales of new homes fell in February for a fourth straight month as the steep slump in housing continues. The 1.8 percent decline, however, was a bit better than economists surveyed by Thomson Financial/IFR had anticipated.

The Dow fell 85.48, or 0.68 percent, to 12,447.12, after falling more than 100 points in earlier trading.

Broader stock indicators also retreated. The Standard & Poor's 500 index fell 7.95, or 0.59 percent, to 1,345.04, while the Nasdaq composite index fell 19.10, or 0.82 percent, to 2,321.95.

Bond prices rose as stocks fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.47 percent from 3.51 percent late Tuesday. The dollar was mixed against other major currencies, while gold prices rose.

Light, sweet crude rose $1.96 to $103.18 a barrel on the New York Mercantile Exchange.

Corporate news appeared to weigh on some investors. Private equity firms leading a $19.5 billion buyout of Clear Channel Communications Inc. were having difficulty reaching terms with the banks committed to financing the deal and the plan was close to collapse, according to a report by The Wall Street Journal.

Meanwhile, Motorola Inc. said it plans to split its troubled handset business from other operations, creating two separate, publicly traded companies.

Electronic parts manufacturer Jabil Circuit Inc. posted a fiscal second-quarter loss and warned its third-quarter results will fall short of Wall Street's expectations.

Overseas, Japan's Nikkei stock average fell 0.30 percent. In afternoon trading, Britain's FTSE 100 fell 0.34 percent, Germany's DAX index fell 0.22 percent, and France's CAC-40 was off 0.47 percent.


Comments are posted from viewers like you and do not always reflect the views of this station.
powered by Disqus
631 SW Commerce Pl. Topeka, Kansas 66615 phone: 785-272-6397 fax: 785-272-1363 email: feedback@wibw.com
Gray Television, Inc. - Copyright © 2002-2014 - Designed by Gray Digital Media - Powered by Clickability 17014381 - wibw.com/a?a=17014381