Stocks dip as investors weigh recovery bets
U.S. stocks fell for third straight day on Friday as investors took weaker-than-expected results from computer maker Dell and homebuilder D.R. Horton as a further sign that the recovery would be anemic.
Following the S&P 500's gain of more than 60 percent from its 12-year closing low of March 9, investors were more sensitive to signs of weakness as they sought to justify lofty shares valuations.
The news of a 54 percent slide in Dell's quarterly profit rounded off a rocky week for the technology sector, which since the start of the market's run-up in March has been a darling as investors bet on a strong recovery that would spur corporate and consumer spending.
While it appears to us that the recession is over, there are a lot of lingering signs of pain on Main Street, said Sasha Kostadinov, portfolio manager and research analyst at Shaker Investments in Cleveland, Ohio. The unemployment is very high, lots of people out of work and that is still causing significant stress.
The Dow Jones industrial average <.DJI> dropped 19.57 points, or 0.19 percent, to 10,312.87. The Standard & Poor's 500 Index <.SPX> fell 4.44 points, or 0.41 percent, to 1,090.46. The Nasdaq Composite Index <.IXIC> shed 13.39 points, or 0.62 percent, to 2,143.43.
Trading was choppy with the monthly expiration of November options on Friday.
A rebound in the U.S. dollar pressured prices of global commodities, including crude. Energy stocks were hurt, such as Chevron Corp
Even so, the Dow's losses were curbed by buying of defensive stocks, or shares of companies seen better able to withstand an uncertain economy. Coca-Cola Co
Dow component General Electric Co
GE shares shed 1.3 percent to $15.56.
Goldman Sachs Group Inc
The S&P 500 is up 61.2 percent from the 12-year closing low of March 9 but was on track to halt a two-week winning streak on Friday.
(Editing by Kenneth Barry)
© Copyright Thomson Reuters 2024. All rights reserved.