After tough January, stocks extend slide
Monday, February 3, 2014
For investors, February is starting off even rougher than January.
U.S. stocks tumbled on Monday, pushing the Dow Jones industrial average down more than 320 points after reports of sluggish U.S growth added to investor worries about the global economy. It was the biggest one-day decline for the blue-chip index in more than seven months. And the drop followed the Dow’s worst January performance since 2009.
The market stumbled from the get-go, with U.S. stocks opening lower after declines in European and Japanese indexes. Then it quickly turned into a slide as a spate of discouraging economic data on everything from manufacturing to auto sales to construction spending poured in.
By late afternoon, the sell-off accelerated further, bringing the Dow down more than 7 percent for the year. The S&P 500 index was down more than 5 percent for 2013.
Some stock watchers took the market’s decline in stride. They considered it a necessary recalibration following the market’s record highs at the end of last year.
“It’s a bit painful for investors to see the equities markets drop as they have, but this is healthy for this market,” said Chris Gaffney, a senior market strategist at EverBank. “We’ve been almost 2-1/2 years without a 10 percent correction.”
All told, the Dow dropped 326.05 points, or 2.1 percent, to close at 15,372.80, its biggest decline since June 20, 2013.
The Standard & Poor’s 500 index lost 40.70 points, or 2.3 percent, to 1,741.89. The Nasdaq composite dropped 106.92 points, or 2.6 percent, to 3,996.96.
There were signs of worry throughout the market. The VIX index, a measure of stock market volatility, rose to its highest level since December 2012. Investors shifted into U.S. government bonds, pushing yields lower and extending their sharp decline since the start of the year.
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