Wall Street falls more than 2 percent on slowdown fear
NEW YORK (Reuters) – Wall Street thrown on Thursday after slowing US factory activity on the heels of a dire revenue announcement from Apple Inc.
The size of Apple's holiday quarter Income failure sent shockwaves through the technology sector, pulling all three major US stock indices down more than 2 percent, while Nasdaq posted a 3 percent loss.
S & P Technology Companies <.SPLRCT> went 5.1 percent, the largest one-day percentage decline since August 2011. The Philadelphia SE Semiconductor Index <.SOX> ended the season by 5.9 percent lower.
Later Wednesday, Tim Cook said in a letter to investors that the company had not expected the scale of China's economic retardation, which was exacerbated by trade tensions between the United States and China. The IPhone manufacturer's shares dropped 10.0 percent.
A report from the Department of Supply Management showed that US manufacturing activity
"The Chinese slowdown was expected, but today's softer than expected ISM numbers surprised investors because the US seemed to be the only storm in the storm," said Sam Stovall, chief investment strategist for CFRA Research in New York. "But now it seems that our economic growth is facing trade-related headwinds."
"Investors are worried that this is an indication that it could get worse from here, and Apple is just the tip of the glacier," Stovall added.
Large car manufacturers reported weak US new car sales in December, with Ford Motor Co
Dow Jones Industrial Average <.DJI> fell 660.02 points, or 2.83 percent to 22,686.22, lost S & P 500 <.SPX> 62.14 points, or 2.48 percent to 2,447.89 and Nasdaq Composite <.IXIC> fell 202.43 points, or 3.04 percent, to 6 463.50.
Of the 11 major sectors of the S & P 500, all store defense <.SPLRCR> and tools <.SPLRCU> were closed in red. Commercially-traded industrial areas also weighed on Dow, led by Caterpillar Inc
shares from Bristol-Myers Squibb Co.
Shares of US commercial airlines occurred after Delta Air Lines
Dividends on 2-year government bonds dipped under federal fund-effective interest rates for the first time since 2008, a lot of belief that the central bank will not be able to continue its monetary policy. The outlook for higher prices has been considered a wind blow against stocks in recent months.
Falling problems challenged to promote those on the NYSE with a 1.39 to 1 ratio; On Nasdaq, a 2.28-to-1 ratio favored decliners.
S & P 500 posted no new 52-week high and 13 new downs; Nasdaq Composite recorded 6 new heights and 48 new downs.
Volume on US exchanges was 8.11 billion shares compared to the 9.1 billion average over the last 20 days.
(Reporting by Stephen Culp; Editing by Phil Berlowitz)
