Wednesday, 12 August 2015 20:52
NEW YORK: US stocks fell early Wednesday, retreating for a second straight day on concerns about China following disappointing data from the world’s second-biggest economy.
About 25 minutes into trade, the Dow Jones Industrial Average stood at 17,214.50, down 188.34 points (1.09 percent).
The broad-based S&P 500 dropped 19.74 (0.95 percent) to 2,064.33, while the tech-rich Nasdaq Composite Index fell 56.84 (1.13 percent) to 4,979.95.
Chinese data released Wednesday all came in below expectations. Industrial production rose 6.0 percent, below the median forecast for a 6.6 percent rise. Chinese retail sales and fixed asset investment also lagged behind analyst forecasts.
The Chinese data “compounded the negative investor sentiment” after Tuesday’s surprise devaluation of the yuan pressured US stocks, said Patrick O’Hare, analyst at Briefing.com.
Chinese e-commerce giant Alibaba tumbled 6.7 percent after reporting revenues of $ 3.27 billion for the quarter ending June 30, below the $ 3.39 billion projected by analysts. Yahoo, which has a large stake in Alibaba, fell 5.6 percent.
Department store chain Macy’s dropped 3.5 percent as it cut its forecast for 2015 comparable sales to flat compared with the previous projection for a gain of two percent. Results in the second quarter were marred by the strong US dollar.
KraftHeinz fell 1.0 percent as it said it would trim 2,500 US and Canadian jobs following the merger of the two food giants.
Fossil Group, which sells sunglasses and other accessories, fell 3.4 percent as it projected a drop in 2015 sales of four to eight percent, due in part to the strong dollar.
Large banks declined, including Bank of America (-2.7 percent), Citigroup (-2.6 percent) and Dow member JPMorgan Chase (-2.4 percent).
Bond prices rose. The yield on the 10-year US Treasury fell to 2.12 percent from 2.14 percent Tuesday, while the 30-year dipped to 2.80 percent from 2.81 percent. Bond prices and yields move inversely.
