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Stocks Fall in Early Trade 11/20 10:34
The stock market lost ground for a third straight day as investors grew
increasingly uneasy about a rising dollar and spiking demand for the safest
government debt.
NEW YORK (AP) -- The stock market lost ground for a third straight day as
investors grew increasingly uneasy about a rising dollar and spiking demand for
the safest government debt.
With little U.S. economic news to help sway the market Friday, the dollar
again drove trading. A strengthening dollar curtails foreign demand for
commodities, which are often traded in dollars. It also can depress U.S.
exports, which become more expensive as the dollar rises.
That can hurt the price of energy and materials stocks that are closely tied
to commodities and the stocks of companies with large operations overseas.
A disappointing earnings report from computer maker Dell Inc. weighed on
technology shares and hurt the Nasdaq composite index. Dell said late Thursday
that sales of its computers to big businesses remain sluggish. Its quarterly
revenue and profit missed analysts' expectations.
As investors moved out of stocks, they moved into safer investments like
Treasury bonds. The yield on the three-month T-bill, which moves opposite its
price, is hovering near its lowest level of the year, which it hit Thursday.
Yields briefly turned negative Thursday as demand jumped for the safest
short-term government debt.
In midmorning trading, the Dow Jones industrial average fell 25.62, or 0.3
percent, to 10,306.82. The Standard & Poor's 500 index fell 5.06, or 0.5
percent, to 1,089.84, while the Nasdaq fell 36.32, or 1.7 percent, to 2,139.84.
The ICE Futures US dollar index, which measures the dollar against other
major currencies, rose 0.6 percent.
The yield on the three-month T-bill was 0.02 percent after falling as low as
0.005 percent late Thursday. The yield on the benchmark 10-year note rose to
3.36 percent from 3.34 percent.
"Investors seem to need a constant reassurance with where we are in the
economic recovery," said Brett D'Arcy, chief investment officer at CBIZ Wealth
Management Group in San Diego. "We just haven't gotten it in the past few days."
D'Arcy expects stocks to continue to sell off Friday given the disappointing
economic data earlier this week.
Weak housing and mortgage data the past two days has helped bring the
market's nearly relentless rise to a halt amid concerns any economic recovery
will be slow and bumpy. On Thursday, the Mortgage Bankers Association provided
fresh evidence that the housing market is still fragile. The trade group said
more than 14 percent of homeowners with a mortgage were behind in their
payments or facing foreclosure at the end of September.
Among stocks, Dell fell $1.40, or 8.8 percent, to $14.47.
Homebuilder D.R. Horton Inc. said its fiscal fourth-quarter loss narrowed as
it took smaller write downs on its inventory. Even as its losses shrank,
revenue fell 42 percent as the housing market remained unsteady. The stocks
fell $1.06, or 8.7 percent, to $11.19.
Crude oil fell $1.10 to $76.36 per barrel on the New York Mercantile
Exchange as the dollar rose.
Two stocks fell for every one that rose on the New York Stock Exchange,
where volume came to 315.6 million shares compared with 143.6 million shares
traded at the same point Thursday.
The Russell 2000 index of smaller companies fell 1.48, or 0.3 percent, to
584.20.
Overseas, Japan's Nikkei stock average fell 0.5 percent. In afternoon
trading, Britain's FTSE 100 fell 0.3 percent, Germany's DAX index lost 0.4
percent, and France's CAC-40 dropped 0.4 percent.
(KM)
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