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Overnight Markets: Wall Street down on weak manufacturing data
An unexpected contraction in manufacturing dampened optimism about China's economic growth.
Wall Street declined on Monday as an unexpected contraction in manufacturing dampened optimism about China's economic growth.
The Dow Jones industrial average fell 60 points, or 0.46%, to 12,966 at the close. The Standard & Poor's 500 Index declined seven points, or 0.47%, to 1,409. The Nasdaq Composite Index dropped eight points, or 0.27%, to end at 3,002.
Markets had opened higher after data showed output by China's factories grew in November for the first time in more than a year.
But shares declined after U.S. manufacturing activity surprisingly contracted in November, the Institute for Supply Management said, dropping to its lowest level in more than three years.
The fiscal cliff continued to be the investors' primary focus, amid ongoing political wrangling over how to deal with large automatic spending cuts and tax hikes scheduled to kick in next year.
In the eurozone, Spain formally requested the disbursement of more than $50 billion of European funds to recapitalise its crippled banking sector, while Greece said it would spend €10 billion to buy back bonds to reduce its increasing debt.
Retail stocks and materials were the weakest sectors on Monday. Newmont Mining fell 3% after the company said its CEO resigned. Dow component DuPont shed 1.7%, leading raw-materials producers to the biggest drop among 10 S&P 500 groups.
J.C. Penney Co was off 3.2% and Staples Inc shed 2.3%.
Technology shares gained with Dell shares rising 4.4% after Goldman Sachs upgraded the stock to "buy" from "sell. Advanced Micro Devices was the S&P's top gainer, rising 7.3%.
In Asia, most stocks fell after U.S. manufacturing unexpectedly contracted and American policymakers haggle over new budget proposals.
The MSCI Asia Pacific Index slipped 0.2% to 124 as of 12:02 p.m. in Tokyo. South Korea’s Kospi Index slipped 0.5% and Japan’s Nikkei 225 Stock Average lost 0.4%. Hong Kong’s Hang Seng Index swung between gains and losses, while China’s Shanghai Composite Index slid 0.2%. Australia’s S&P/ASX 200 Index dropped 0.3%.
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by Gavin Lumsden on May 23, 2013 at 10:05