Bloomberg News
U.S. stocks tumbled, with the Standard & Poor's 500 Index dropping the most in seven weeks, as Apple Inc. sank amid speculation Russia may seize foreign assets and data that fueled concern rates may rise soon.
Apple Inc. plunged 3.5 percent to drag technology stocks lower amid snafus in the rollout of a new smartphone. Twitter Inc. and Pandora Media Inc. slid at least 2.2 percent to pace losses among Internet companies. The Russell 2000 Index of small stocks sank 1.5 percent as investors sold speculative shares.
The S&P 500 fell 1.2 percent to 1,974.18 at 11:11 a.m. in New York, headed for its lowest close since Aug. 18. The Dow Jones Industrial Average plunged 204.70 points, 1.2 percent, to 17,005.36. The Nasdaq 100 Index slid 1.7 percent, its biggest decline since July. Apple is the largest component of both the S&P 500 (SPX) and the Nasdaq 100.
Today's decline in the S&P 500 sent the benchmark gauge below its average price for the past 50 days for the first time since August on a closing basis. The index is down 1.5 percent in September.
The small-cap Russell 2000 has plunged 8 percent from a high on July 3, while the Dow Jones Internet Composite Index has lost 4.7 percent since Sept. 8.
The S&P 500 climbed 0.8 percent yesterday, its biggest gain since Aug. 18, to rebound from a 1.4 percent slide over three days after closing Sept. 18 at an all-time high. The gauge has not had a four consecutive declines this year.
Asset Seizure
Equities extended losses today on a report that Russian lawmakers are drafting legislation that would allow the government to seize foreign assets in Russia in response to sanctions.
U.S. data today showed applications for unemployment benefits in the U.S. increased less than forecast last week as an improving economy prompted employers to retain staff. Orders for U.S. business equipment climbed more than forecast in August, indicating corporate investment will help spur economic growth.
Investors are scrutinizing data for clues on whether economic growth is strong enough to withstand higher interest rates. The Federal Reserve last week retained assurances that its benchmark rate will stay low for a 'considerable time' after its bond buying ends, while cautioning that the timing could move forward if data continues to exceed expectations.
Data tomorrow will show gross domestic product grew 4.6 percent in the second quarter, more than the previous estimate of 4.2 percent released Aug. 28, according to a Bloomberg survey of analysts.
Fed Presidents
Charles Evans, president of the Chicago Fed, yesterday joined the New York Fed's William C. Dudley and Narayana Kocherlakota of Minneapolis in warning the Fed shouldn't make a change before being sure the economy can withstand higher borrowing costs. The trio argued separately that moving prematurely poses a greater risk to the economy than waiting too long.
'Everyone is still waiting for a change in Fed policy, the timing on which is still unknown,' Chris Hyzy, chief investment officer of U.S. Trust in New York, which oversees $325 billion, said in a phone interview. 'There's a lot of position squaring going on in the month of September. We still expect very limited downside swings in the market before now and the end of the year.'
The Chicago Board Options Exchange Volatility Index (VIX), the gauge known as the VIX, increased 18 percent to 15.62 today, the most since July. The index slid 11 percent yesterday after surging 24 percent over the prior three days.
To contact the reporter on this story: Joseph Ciolli in New York at jciolli@bloomberg.net
To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net Jeremy Herron
Posted by Unknown on Thursday, September 25, 2014 - Rating: 4.5
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