Late retreat sinks stocks

chart_ws_index_dow.top.png By Alexandra Twin, senior writer


NEW YORK(CNNMoney.com) -- Stocks slumped Tuesday, ending a choppy session lower, as worries about the global economic outlook overshadowed better-than-expected readings on the U.S. economy.

The Dow Jones industrial average (INDU) fell 112 points, or 1.1%. The S&P 500 index (SPX) lost 19 points, or 1.7% and the Nasdaq composite (COMP) fell 35 points, or 1.5%.

The market retreated in early trading after a report showed slower manufacturing growth in China and the euro briefly fell to a fresh four-year low. Better-than-expected readings on U.S. construction and manufacturing helped turn the tide in the morning. But the market sold off again heading into the close.

Stocks tumbled last month, with the Dow's decline of 7.9% its worst May performance since 1940. All financial markets were closed Monday for Memorial Day.

The pullback came as the euro plunged and the European debt crisis threatened to slow global growth. Worries about China's slowdown were also a factor.

These issues are likely to continue pressuring stocks, said Stephen Carl, head equity trader at Williams Capital Group.

"I don't think the selling is over by any means," he said. "It looks like we're hovering in a range around 10,000 (on the Dow), but there could still be more selling to come."

Economy: The Institute for Supply Management's May manufacturing index fell to 59.7 from 60.4. However, the index was expected to fall more, to 58.9, according to a consensus of economists surveyed by Briefing.com.

Any reading above 50 indicates expansion in the sector. The index has indicated expansion for 10 consecutive months.

Construction spending rose 2.7% in April, trouncing expectations for a rise of 0.1%. The government reported construction spending rose 0.4% in March.

Companies: BP (BP) shares plunged 15% as the company's latest attempt at stopping the oil spill - now in its seventh week - failed. The company had tried to stop the spill - the worst in U.S. history - by forcing mud into the leaking well

Since the Deepwater Horizon exploded on April 20, the stock has lost more than one-third of its value.

AIG (AIG, Fortune 500) shares fell after the company rejected Prudential PLC's request to lower the price of its $35.5 billion deal to buy AIG's Asian affiliate, raising the chances of the deal falling apart.

On the upside, Apple (AAPL, Fortune 500) shares gained after the company said Monday that it has sold its 2 millionth iPad. Following the news, a number of analysts raised their estimates on iPad sales and Apple's quarterly and fiscal-year figures.

Hewlett-Packard (HPQ, Fortune 500) announced it is cutting its total workforce by 3,000 over the next few years as it accelerates its use of automatic data centers for business customers. Shares of the Dow component gained 0.5%.

A variety of financial shares fell, lowering the KBW Bank (BKX) sector index by 2.6%.

Euro: The European currency seesawed after touching a four-year low of $1.2111 in the morning.

The dollar rose 0.2% against the yen.

World markets: Markets in Europe were mixed. Britain's FTSE 100 lost 0.5%, Germany's DAX gained 0.3% and France's CAC 40 lost 0.1%.

Asian markets ended lower. Japan's Nikkei lost 0.6% and Hong Kong's Hang Seng fell 1.4%. China's Shanghai Composite lost 0.9%.

Commodities: U.S. light crude oil for July delivery fell $1.39 to settle at $72.58 a barrel on the New York Mercantile Exchange.

COMEX gold for August delivery rose $11.90 to settle at $1,226.90 an ounce.

Bonds: Treasury prices were little changed, with the yield on the 10-year note holding at 3.30%, little changed from late Friday. Treasury prices and yields move in opposite directions.

Trading volume: Market breadth was negative. On the New York Stock Exchange, losers beat winners three to one on volume of 1.43 billion shares. On the Nasdaq, decliners topped advancers by over four to one on volume of 2.15 billion shares. To top of page

Just the hot list include
Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 32,627.97 -234.33 -0.71%
Nasdaq 13,215.24 99.07 0.76%
S&P 500 3,913.10 -2.36 -0.06%
Treasuries 1.73 0.00 0.12%
Data as of 6:29am ET
Company Price Change % Change
Ford Motor Co 8.29 0.05 0.61%
Advanced Micro Devic... 54.59 0.70 1.30%
Cisco Systems Inc 47.49 -2.44 -4.89%
General Electric Co 13.00 -0.16 -1.22%
Kraft Heinz Co 27.84 -2.20 -7.32%
Data as of 2:44pm ET

Sections

Bankrupt toy retailer tells bankruptcy court it is looking at possibly reviving the Toys 'R' Us and Babies 'R' Us brands. More

Land O'Lakes CEO Beth Ford charts her career path, from her first job to becoming the first openly gay CEO at a Fortune 500 company in an interview with CNN's Boss Files. More


Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.