RTRS: US STOCKS-Retail sales slump ends market's brief rebound
By Ellis Mnyandu
NEW YORK, Nov 14 (Reuters) - U.S. stocks dropped on Friday as data showing a record drop in retailers' sales last month deepened worries about an economic downturn and prompted investors to book profits from Thursday's large gains.
Consumer spending is a pillar of economic activity and corporate profits. The manufacturing and high tech sectors also showed losses.
Among retailers, Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz) fell more than 2 percent. Investors also sold big manufacturers, with Caterpillar Inc (CAT.N: Quote, Profile, Research, Stock Buzz), off nearly 6 percent, and Boeing (BA.N: Quote, Profile, Research, Stock Buzz) down about 5 percent following news of a delay of its new 747 jumbo.
Cellphone maker Nokia (NOK1V.HE: Quote, Profile, Research, Stock Buzz) warned about its outlook and weighed on the technology sector, along with news that computer maker Sun Microsystems (JAVA.O: Quote, Profile, Research, Stock Buzz) will slash as many as 6,000 jobs to mitigate the impact of faltering global demand.
"People realize yesterday's euphoric bounce was overdone and it feels like the appropriate measure is to take profits in the names that got ahead of themselves yesterday," said Justin Wiggs, a trader at Stifel Nicolaus Capital Markets in Baltimore.
The Dow Jones industrial average .DJI slid 220.46 points, or 2.50 percent, to 8,614.79. The Standard & Poor's 500 Index .SPX slumped 26.37 points, or 2.89 percent, to 884.92. The Nasdaq Composite Index .IXIC shed 51.62 points, or 3.23 percent, to 1,545.08 after having declined more than 4 percent.
The 2.8 percent fall in retail sales in October was a record, the Commerce Department, but part of the drop was due to slumping gasoline prices, which helped buoy consumer confidence in another report.
Energy shares were a top drag on the market after leading Thursday's upswing, with shares of Chevron (CVX.N: Quote, Profile, Research, Stock Buzz) down nearly 5 percent at $71.61.
In Thursday's rally, which was the biggest surge in two week, Wall Street broke a three-day string of losses after the S&P 500 and Nasdaq touched fresh five-year lows. Analysts on Friday said though they doubted the market would sustain the upside.
