Slowing growth dents stocks
NEW YORK Investors are turning cautious on Wall Street just one week after the stock market hit an all-time high.
Stocks fell amid new signs of weakness in Europe's economy. Poor earnings news from Bank of America (BAC) and an apparent drop in demand for Apple's (AAPL) iPod and iPhone contributed to the selling.
Banking, tech and energy stocks led the way lower.
The Dow Jones industrial average lost 138 points to 14,618 Wednesday, or 0.9 percent.
The Standard & Poor's 500 fell 22 points, or 1.4 percent, to 1,552.
The Nasdaq composite fell 60 points, or 1.8 percent, to 3,204. Apple, the biggest component in the index, slumped nearly 6 percent.
Three stocks fell for every one that rose on the New York Stock Exchange. Volume was high, 4.2 billion shares.
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Stocks surged during the first three months of the year on optimism that a recovery in the housing market would boost the economy. But the stock market has struggled this month. Reports of weak hiring and retail sales suggested the economy may be cooling off.
"You've had numerous economic data points that have been, not really disastrous, but not really as robust as people might like," said Cam Albright, director of asset allocation at Wilmington Trust Investment Advisors. "When you have a market as extended as this, you almost need perfect information to make it continue to go up."
Reports this week have added to a picture slowing global growth.
New car sales in Europe fell 10 percent in the first quarter, the European automakers association said Wednesday, as high unemployment saps demand for big purchases. Britain said Wednesday that unemployment rose to 7.9 percent during the three months ending in February, an increase of 0.2 percent from the previous three months.
On Tuesday, the International Monetary Fund lowered its outlook for global growth, saying government spending cuts will slow the U.S. and European economies. And on Monday China said its economic growth slowed in the first three months of the year to 7.7 percent, below the 8 percent level anticipated by markets.
Bank of America fell 4.8 percent to $11.68 on Wednesday and led financial stocks lower after reporting a first quarter profit of $2.3 billion. That fell short of analysts' expectations.
Among other stocks making big moves—