MW: U.S. stocks dropping in last session of quarter
By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) — U.S. stocks fell sharply Friday as data showed a contraction in manufacturing activity in the Chicago area.
“What we’re seeing here, particularly in the Midwest, is a weakness in autos and all the things that go into them, like primary metals,” said Stuart Hoffman, chief economist at PNC Financial Services Group.
“We had a heck of a good quarter and month for stocks beyond what anyone thought,” said Hoffman, who finds the market’s recent declines not a surprise given the overall gains. “So now we’re having a step backward as some of the QE3-inspired gains dissipate.”
The Dow Jones Industrial Average DJIA -0.64% fell 86.94 points, or 0.6%, to 13,399.11 with 26 of its 30 components in the red, led by McDonald’s Corp. MCD -2.23% after Janney Montgomery Scott LLC lowered its view of the fast-food chain.
For the quarter, the index was headed for a 4% gain, up more than 2% for the month, but down more than 1% for the week.
The S&P 500 index SPX -0.65% lost 8.85 points, or 0.6%, to 1,438.30, with energy and materials slammed the hardest among its 10 large sectors. The benchmark index traded around 5.6% higher for the quarter, up 2.2% for the month, and down 1.5% for the week.
The Nasdaq Composite COMP -0.72% fell 17.33 points, or 0.6%, to 3,119.30, trading over 6% higher for the quarter. For the month, it was up 1.6%, but down nearly 2% from a week ago.
Shares of Nike Inc. NKE -1.24% fell after the athletic retailer reported future orders missed Wall Street’s estimates of reduced demand in China. See: Nike profit falls on weaker margins, rising costs.
Research In Motion Ltd. RIMM +9.52% shares climbed after the BlackBerry maker reported less of a loss that analysts had projected. See: BlackBerry sales give RIM surprise boost.
Economic reports already out had consumer spending rising 0.5% and income up 0.1% in August, largely in line with Wall Street’s estimates. See: U.S. consumer spending jumps in August.
A regional measure of business activity from the Chicago Federal Reserve showed contraction in September, illustrating the recent slowdown seen in the manufacturing sector.
A gauge of consumer sentiment rose to 78.3 for a final September reading from 74.3 in August, according to data on the University of Michigan-Thomson Reuters consumer-sentiment gauge released Friday. See: Consumer sentiment highest in four months.
Kate Gibson is a reporter for MarketWatch, based in New York.
