Stocks fall on retail sales, China inflation
US spending growth lost momentum in January. Manufacturing activity increases in the New York region. FedEx cuts its quarterly profit forecast.
By Melinda Peer, TheStreet
Updated at 12:47 p.m. ET
Stocks were slipping Tuesday as concerns about rising inflation in China weighed heavily on basic materials and as weaker-than-expected retail sales growth in the U.S. pressured Wall Street.
At 12:47 p.m., the Dow Jones Industrial Average ($INDU) was down 35.2 points, or 0.3%, at 12,232. The S&P 500 ($INX) was down by 3 points, or 0.2%, at 1,329 and the Nasdaq ($COMPX) was falling 6.2 points, or 0.2%, to 2,810.
China's inflation rose 4.9% in January on a 10.3% jump in food costs. The increase was slightly higher than December's uptick of 4.6% and just below the 28-month high of 5.1% in November. The Chinese government has raised interest rates three times since October to rein in economic growth.
Basic materials stocks were showing the weakest performance. Crop nutrient companies CF Industries (CF), Mosaic (MOS) and Potash (POT) were each down by more than 3%, and Freeport-McMoRan Copper & Gold (FCX) was off by 2.2% at $54.91.
Shares of U.S. Steel (X), however, were up 4% at $62.78 after Goldman Sachs upgraded the stock to buy from neutral and said it expects shares to jump 24% in the next six months as U.S. Steel takes advantage of rising steel prices, according to a recent note.
There were 330 million shares trading on the New York Stock Exchange, 41% of which were rising while 55% were losing ground. On the Nasdaq, 882 million shares were changing hands.
The Commerce Department said January retail sales in the U.S. rose 0.3%, less than the 0.5% economists had expected and less than December's 0.5% increase. Excluding autos, sales jumped 0.3%, compared with a projected 0.6% uptick.
"Expectations for January retail sales were loftier than actual results, perhaps due to strong results in recent months generating a bit too much optimism about the durability of the consumer," said Jim Baird, a chief investment strategist at Plante Moran Financial Advisors. "Winter storms may have also had a moderating effect on sales for the month, as shoppers were less enthusiastic about venturing out."
There were 246 million shares trading on the New York Stock Exchange, 36% of which were rising while 60% were losing ground. On the Nasdaq, 645 million shares were changing hands.
The Federal Reserve Bank of New York said manufacturing activity in the New York region increased in February. The Empire State manufacturing index rose to 15.43 from 11.92 in January. Economists had expected a reading of 15.5.
Export prices, excluding agriculture, climbed 0.9% in January after rising by 0.6% in December. Import prices, excluding oil, increased 0.8%, after growing 0.3% in December.
The Commerce Department said business inventories rose 0.8% December, compared with the increase of 0.6% that economists had been projecting. In November, inventories grew 0.4%.
The National Association of Home Builders housing market index remained unchanged at a reading of 16 in February. Wall Street had expected it to climb to 17, according to Briefing.com.
Deutsche Boerse and NYSE Euronext (NYX) announced a merger today. The Wall Street Journal said the 17-member board of the combined company will be drawn mostly from the German company. NYSE Euronext's stock was falling 3.1% at $38.21.
Sirius XM (SIRI) reported a fourth-quarter loss of 2 cents a share as operating services expenses rose and the satellite radio company paid off a large portion of its debt. Analysts had expected Sirius to break even. The stock was off by 5.1% at $1.74.
Shares of FedEx (FDX) were up 1.9% at $95.84 despite the company cutting its earnings forecast for the current quarter by 25 cents, citing severe weather and higher fuel prices. FedEx expects its fiscal third-quarter adjusted earnings to be 70 cents to 90 cents a share, down from its previous range of 95 cents to $1.15.
At 4:30 p.m., the American Petroleum Institute will issue its weekly report on crude oil inventories. Analysts surveyed by Platts estimate that supplies increased by 2.8 million barrels during the week ended Feb. 11.
Crude oil for March delivery was losing 63 cents at $84.18 a barrel. The April gold contract, the most actively traded gold future, was rising by $8 at $1,373.10 an ounce.
The benchmark 10-year Treasury was down by 8/32, lifting the yield to 3.649%. The dollar was weakening against a basket of six currencies, with the dollar index down by 0.3%.
Hong Kong's Hang Seng fell 1%, while Japan's Nikkei added 0.2%. London's FTSE was shedding 0.05%, while the DAX in Frankfurt was ahead by 0.2%.
ABC TV news last night had an ineresting pie chart comprised of pennies describing the government's budget. over 3/4 of the pie was military and entitlements like SS and medicare. yet the budget cuts were to minor pennies and portions of pennies.
makes one wonder though with so much of the "pie" also reflecting the people behind it (granted government weenies with nice pensions) if that portion of the pie was cut HOW many new people would become unemployed THEN?
the gov't spending is part of our makeup like a cancer. is it possible to cut it out to any significant extent?
i saw first hand many worthless military projects. yet i'm sure this reflects minor pennies to the budget. however it also affected many people including me.
perhaps not cutting the budget is as important as simply spending that same money on projects that will yield a return on invenstment to us instead of simply another form of welfare.
Obama called his new budget one of "tough choices and sacrifices," but most of those cuts would be held off until after the end of his first term.
Why do we keep electing people with less testicular fortitude than the baby inside 2 sick's wife's womb?
PS I thought you were a mutual fund guy? Say "Hi" to Warren.
Look at the population of any country. They always reflect the kind of government they have. The crowds in Egypt are a drooling bunch of Bozos thinking they are going to get jobs and a better life. They can't blame their plight on Hosni. He probably did more for their welfare simply by maintaining order among an unruly mob. The new goverment of army generals are busy at work planning for their new days of freedom - yikes.
And look at Iraq - we have wasted our treasure and lives of young men to free this bunch of bozos whose only virtues appear to be making bombs and arguing with each other. We got rid of ole Sadam for this? We liked him as long as he was killing Iranians!
And we continue to meddle in the affairs of Iran. The despots there will likely execute the protesters which will be very effective in quelling unrest. Hillary will then give a speech chiding this bad behavior.
And what about our own country? We have a society full of crackers who are mostly worthless as for making any contributions to our society. About all they seem capable of is breeding and applying for the numerous entitlements Obami El Salami smilingly want to hand out.
should we raise taxes on multi millionaires?I would be happy to raise taxes on Michael Moore et al
Congrats 2 sick, now the real fun begins and I mean real fun. Kids are truly amazing and they will raise you more than you raise them.
One of my fondest moments was when I was walking in the school and out of the sea of kids one kid pops his head out then followed by three other smiling kids. that one kid grabs my hands and proudly proclaims THIS IS MY DAD... SIGH!!
How foolish were the sheeps that bough shares in Government Motors? I cannot help but laugh at poor dopes that bought GM shares. Today GM decided to pay 4000 bonus' to it's 45,000 workers. Never mind the owners. They don't need the profits, they are going to the collective, socialist workforce... LOL
Government Motors? more like USSR motors... Only a complete MORON would ever consider buying a Government Motors, or should I say socialist motors...
I'd advise shareholders to SELL....
Lost On Earth
The best way of balancing the budget is by having all the Republicans, Neo-Cons, Tea Partiers and Libertarians "CUT their own throats". Now that's what I call a prosperous future for America!
I suppose that is one way to end the socialists... If you killed off all those paying and supporting the leech (democrat) class, the dependence on government would stop. After all there would be nothin gto redistribute...
Oh wait, didn't the USSR collaspe for the same reason?
"And now, starting at wide receiver, for the Indianapolis Colts, 2 sick juuuuuunnnnnnniiiioooorr!"
Mr Fat Cat
Nice Blog.. Agree with most comments except ability to exercise individual motivation in the market. There is nothing equal about the ability of a day trader or fund manager either individually or collectively (illegal of course) to exercise enormous influence in the market thru frequency trading or inside info. Nor is there any equality for market undertakers like Icahn or Peltz A/K/A corporate raiders to dismember and dismantle a business for personal gain at the expense of the other investors.
So the real game here seems to me to be that the government is the employer of last resort, a necessary part of the economy. Until innovation creates demand for private sector workers, government has to 'employ' the masses so as to avoid demoralization and maybe even revolution.
Am I on the right track?
Either way, it should be pointed out that 2 Sick warned about owning BAC a few weeks ago.
with tons of available government projects to cut, the result would be truly serious unemployment since as a country we do not "do" anything anymore of substance to re-employ these people in other private sector areas. to achieve some level of fix, we'd need to cut military programs and entitlement programs each year, lowering their affect over a few decades. BUT with the two party system dancing back and forth every few years, this will never happen. clinton took 8 years to reach some budget control only to see it get wiped out in about a year.
What has to be done is a wholesale approach to chopping programs. For example, pull the troops out of Iraq and Afgahanistan. Cut the development of new weapon systems
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
[BRIEFING.COM] The S&P 500 ended this week with a bang, roaring to a new all-time high on the back of stronger-than-expected economic data, influential leadership, and an ongoing appreciation for the Fed's monetary policy support.
The bullish bias was evident in premarket action as the S&P futures pointed to a higher start without the benefit of any definitive news catalyst. Stocks indeed benefited from a blast of buying interest at the opening bell on this ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
All hail the bull market, which ended the week with a big rally. But it also is starting to look a little like 1987, which suffered an epic blow-out.