U.S. Stocks Fall on Signs of Slowing Growth
BY DJ Realtime News Equity 10:50 AM ET 09/20/2012
--U.S. stocks fall on investor concerns about economic growth
--Initial jobless claims higher than expected
--Norfolk Southern joins FedEx in providing lower full-year guidance
By Alexandra Scaggs
NEW YORK--Stocks fell on worries about global economic growth.
The Dow Jones Industrial Average fell 20 points, or 0.15%, to 13558.
The Standard & Poor's 500-stock index lost 4 points, or 0.3%, to 1456 and the Nasdaq Composite gave up 11 points, or 0.3%, to 3171.
Data that showed economic slowing in Europe and China sent tremors through global markets, and the U.S. posted weaker-than-expected labor-market data one hour before the open of trading. Initial claims for jobless benefits in the latest week declined slightly from the previous week, to 382,000. That was more jobless claims than expected by economists, who expected a decline to 373,000.
"The data points to the fact that we're in a below-average, painfully sluggish economy," said Hank Smith, chief investment officer of Haverford Trust, a Radnor, Pa.-based firm with $6.5 billion under management. "The market has come a long way recently, so it wouldn't be surprising for it to take a pause here."
In corporate news, Norfolk Southern Corp. slumped 7.2% after the railroad company provided a third-quarter earnings outlook that was well below current analyst estimates, citing declines in volume and lower revenue from fuel surcharges. Norfolk Southern's warning came less than two days after FedEx Corp. warned investors its full-year profits would be lower than it had previously expected. Transportation and shipping companies are considered to be bellwethers for economic activity.
"As the focus turns toward fundamentals, both corporate and economic, the news is clearly not good," said Ted Weisberg, trader for Seaport Securities.
European markets slipped, with the Stoxx Europe 600 down 0.3%, after data showing business activity in the euro zone contracted at the fastest pace since June 2009 offset strong demand at a Spanish bond auction.
Asian markets were broadly lower after an initial reading of HSBC's September survey on Chinese manufacturing conditions pointed to continued contraction, with output falling to a 10-month low. China's Shanghai Composite slid 2.1% to its lowest point since Feb. 2, 2009. Japan's Nikkei Stock Average shed 1.6%.
Crude-oil futures slipped 0.3% to $92.05 a barrel, while gold futures lost 0.5% to $1,763.40 a troy ounce. The dollar gained against the euro but fell against the yen.
In corporate news, real-estate listing company Trulia Inc. surged 41% in its trading debut. Trulia's initial public offering was the first in more than a month in the U.S., and was the first of five new listings to hit U.S. exchanges Thursday.
Wholesale motor fuel distributor Susser Petroleum Partners LP rose 12% after pricing near the top of its expected range.
National Bank Holdings gained 3.5%, while Spirit Realty Capital was flat after its offering.
Capital Bank Financial, which operates banks across the Southeastern U.S., opened slightly above its offering price.
Shares of Bank of America fell 1.5% after the Wall Street Journal reported the banking giant is accelerating a cost-cutting plan that includes shedding 16,000 jobs by the end of the year.
Bed Bath & Beyond lost 8.1% after the home merchandise retailer reported fiscal second-quarter earnings that fell short of analyst projections, and same- store sales growth that slowed from the year-ago pace.
ConAgra Foods rallied 7.7% after reporting fiscal first-quarter earnings and revenue that beat expectations, raised its full-year earnings outlook and increased its quarterly dividend by 4.2% to 25 cents a share.
Write to Alexandra Scaggs at alexandra.scaggs@dowjones.com
