By Lynn Thomasson Nov. 12 (Bloomberg) -- U.S. stocks fell for a third day as Best Buy Co.'s warning of a ``seismic'' slowdown in spending and oil's slide to a 20-month low stoked concern the economic slump will curb consumer and commodity companies' earnings. Best Buy, the world's largest electronics retailer, lost as much as 13 percent after saying profit will decrease more than expected amid ``the most difficult climate we've ever seen.'' Exxon Mobil Corp. and Chevron Corp. dropped as crude sank below $58 a barrel, while American Express Co. tumbled 9.2 percent on a report the credit-card company wants $3.5 billion in government aid. Stocks extended declines as Treasury Secretary Henry Paulson scrapped plans to buy devalued mortgage assets. ``It's hard to get away from the drumbeat of negatives,'' said Liam Dalton, who oversees $1.3 billion as New York-based chief executive officer of Axiom Capital Management. Best Buy's forecast cut is ``a further sign of the retrenchment of the consumer and spending that's slowing very, very rapidly across the board.'' The Standard & Poor's 500 Index fell 3.3 percent to 869.47 at 10:39 a.m. in New York. The Dow Jones Industrial Average retreated 288.73 points, or 3.3 percent, to 8,405.23. The Nasdaq Composite Index lost 2.9 percent to 1,535.73. About 12 stocks fell for each that rose on the New York Stock Exchange. Economic Concern The S&P 500 plunged 44 percent from its October 2007 record after the economy contracted in two of the last four quarters and profits for companies in the index extended a yearlong slump. President-elect Barack Obama may inherit the worst U.S. recession in three decades, according to economists surveyed by Bloomberg News, as more than $918 billion in global credit losses drag on global growth. The benchmark for U.S. stocks fell yesterday as a deteriorating outlook for American industry and oil's retreat signaled the economic slump may deepen. Best Buy declined $2.99 to $20.89. Profit for the year ending in February may be as low as $2.30 a share, the company said. Analysts projected $3.04, according to the average estimate in a Bloomberg survey. Exxon Mobil, the world's biggest energy company, fell 2.1 percent to $71.12. Chevron slipped 2.2 percent to $71.96. Oil fell as low as $57.70 a barrel in New York on forecasts that tomorrow's Energy Department report will show U.S. crude inventories grew last week as the worsening economy lessens energy demand. Commodities Slump Energy companies in the S&P 500 lost 1.6 percent as a group, while raw-material producers declined 2.3 percent collectively. AK Steel Holding Corp. fell 9.3 percent to $9.31. The fourth-largest U.S. steelmaker said it's temporarily idling operations at facilities in Ohio and Kentucky because of falling demand. American Express Co. slumped 8.4 percent to $20.53, the most in the Dow average. The credit-card company most dependent on capital markets for fundraising may have requested the government aid before it converted into a bank holding company two days ago, the Wall Street Journal reported, citing unidentified sources. General Motors Corp. rallied 55 cents to $3.47 after House Speaker Nancy Pelosi urged Congress to support the auto industry, rejecting calls to let the country's largest carmaker collapse. Congressional Democrats are urging President George W. Bush to back an economic stimulus package that would provide federal aid to state governments while boosting spending on unemployment assistance, food stamps and infrastructure projects. Earnings Watch Third-quarter earnings decreased 17 percent on average for S&P 500 companies that have reported results, according to Bloomberg data. Profits for 2008 will drop an average 8.5 percent and rise 12 percent next year, based on a survey of analysts' estimates. Google Inc. lost 3 percent to $302.03. Citigroup Inc. analysts said online advertising growth may slow ``materially'' this quarter and lowered their 2008 through 2010 profit estimates for the operator of the most-used Internet search engine. Confidence in the world economy stayed near rock-bottom in November as a global recession loomed, a survey of Bloomberg users on six continents showed. The Bloomberg Professional Global Confidence Index was at 6.6 compared with 4 in October, the lowest level since the survey started a year ago. A reading below 50 means pessimists outnumber optimists. The S&P 500's decline every day this week pared its advance from a five-year low on Oct. 27 to less than 3 percent. The stock benchmark is down 41 percent this year, led by losses in automakers, insurers and financials. Prologis, the world's largest warehouse developer, lost 13 percent to $5.99. The company cut its dividend and said it plans to halt new developments as the credit crisis worsens. Prologis Chief Executive Officer Jeffrey Schwartz resigned. To contact the reporter on this story: Lynn Thomasson in New York at lthomasson@bloomberg.net.

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