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Overnight Markets: US stocks slump on weak factory data
by Himanshu Singh on Feb 04, 2014 at 03:08
Wall Street declined on Monday, with the S&P 500 registering its worst drop since June, as manufacturing in the world’s largest economy slowed more than estimated in January as new order growth plunged by the most in 33 years.
The Dow Jones industrial average fell 326 points or 2.08%, to 15,373, the S&P 500 lost 41 points or 2.28%, to 1,742 and the Nasdaq Composite dropped 107 points or 2.61%, to 3,997.
The Institute for Supply Management’s factory index fell to 51.3 from 56.5 in January souring investor sentiment sharply.
Selling was broad-based. Telecoms and consumer discretionary were among the worst performing sectors. The Dow Jones Transportation average dropped 3.2%.
Stocks have been pressured as the Federal Reserve confirmed its commitment to withdrawing its market-friendly stimulus and by concern about growth in China.
Telecoms suffered on speculation AT&T Inc's (T.N) plan to slash prices on its large shared data plans could prompt other US carriers, particularly larger rival Verizon Wireless (VZ.N), to offer new discounts. AT&T lost 4.1% and Verizon lost 3.4%.
Charter Communications Inc (CHTR.O) is discussing raising its bid for Time Warner Cable Inc (TWC.N), sources said. TWC shares added 0.5%.
Britain's Smith & Nephew (SN.L) is to buy ArthroCare Corp (ARTC.O) for $1.7 billion in cash to strengthen its treatments for sports injuries. ArthroCare shares rose 8.2%.
Pfizer's (PFE.N) shares gained 0.7%, the only Dow stock to close higher, after its experimental breast cancer drug significantly delayed progression of symptoms in a mid-stage trial, meeting the study's primary goal.
Jos. A. Bank Clothiers Inc. slid 5% after telling Men’s Wearhouse Inc. it will not enter takeover talks.
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As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.
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