Wall Street retreats after consumer data sparks worries
By Lewis Krauskopf (Reuters) - U.S. stocks retreated on Thursday a day after massive gains as the sharpest drop in U.S. consumer confidence in years raised fresh concerns about the economy
By Lewis Krauskopf
(Reuters) - U.S. stocks retreated on Thursday a day after massive gains as the sharpest drop in U.S. consumer confidence in years raised fresh concerns about the economy.
The three major U.S. indexes fell more than 2 percent, with the Nasdaq slipping the most. For the month, they are each down more than 12 percent as the benchmark S&P 500 is set to post its biggest percentage decline since 2008 in an increasingly volatile environment for stocks.
Strategists said it was not surprising for the market to pull back after Wednesday's huge advance, which included the Dow Jones Industrial Average's first-ever 1,000-point daily surge.
“There is still a lot of skepticism that yesterday’s rally was just a technical bounce," said David Joy, chief market strategist at Ameriprise Financial in Boston. "There’s not a lot of conviction that we have been able to put in a bottom yet. That won’t happen for a while I don’t think until we are able to see some stability over the course of several more trading days if not longer.”
A measure of U.S. consumer confidence posted its sharpest decline in more than three years in December. The Conference Board said its consumer confidence index fell this month by 8.3 points to a reading of 136.4, the largest one-month drop since July 2015.
The consumer data comes a day after a report that holiday sales were the strongest in years helped mollify concerns about the health of the economy.
“The consumer has been a big support for this economy and if all of a sudden the consumer starts to get a little bit anxious and spending slows down, that’s going to have an impact,” Joy said.
Indeed, the strength of the economy remains a key concern for investors heading into 2019, along with trade tensions between the United States and China, the pace of interest rate hikes, and an expected slowdown in U.S. corporate profit growth.
"One of the things that is very clear is there are probably more things today going on to worry people than usual," said Mark Stoeckle, chief executive officer of Adams Funds in Baltimore.
On Thursday, the Dow Jones Industrial Average <.DJI> fell 549.92 points, or 2.4 percent, to 22,328.53, the S&P 500 <.SPX> lost 67.72 points, or 2.74 percent, to 2,399.98 and the Nasdaq Composite <.IXIC> dropped 210.45 points, or 3.21 percent, to 6,343.90.
All 11 major sectors were in negative territory, with consumer discretionary <.SPLRCD> declining the most. Shares of online retailer Amazon
Declining issues outnumbered advancing ones on the NYSE by a 4.42-to-1 ratio; on Nasdaq, a 3.30-to-1 ratio favoured decliners.
The S&P 500 posted no new 52-week highs and 3 new lows; the Nasdaq Composite recorded 3 new highs and 204 new lows.
(Additional reporting by Chuck Mikolajczak in New York, Medha Singh in Bengaluru; Editing by Shounak Dasgupta and Chizu Nomiyama)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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