Markets

Stocks Retreat on Weak Economic Data

Associated Press
Thursday, November 2, 2006

NEW YORK, Nov. 1 -- Wall Street retreated Wednesday after most of the day's economic data showed weakness, including a report that manufacturing growth in October was the slowest in more than three years.

The Dow Jones industrial average fell 49.71, or 0.41 percent, to 12,031.02. The Standard & Poor's 500-stock index fell 10.13, or 0.74 percent, to 1367.81, and the Nasdaq composite index fell 32.36, or 1.37 percent, to 2334.35.

The Institute for Supply Management, a private research group, reported softness across the U.S. manufacturing sector. New orders, production and prices fell, and hiring was up. Treasurys rallied on the numbers, and the dollar fell.

Data on the housing market also bolstered fears of an economic slowdown. Pending home sales for September fell 1.1 percent, down 13.6 percent from a year earlier. September residential construction spending also fell 1.1 percent, the sixth month that construction spending has dropped, the longest stretch of weakness in residential construction in more than a decade.

The difference between equity investors' sunny focus and bond investors' gloomy outlook widened. Bonds rose as debt investors bid up the possibility of a sharp economic downturn. The yield on the 10-year Treasury fell to 4.57 percent from 4.61 percent late Tuesday. Bonds also rose sharply during Tuesday's session, with the yield on 10-year Treasurys falling to 4.61 from 4.67.

Movers

Caremark Rx and drugstore chain CVS said they were discussing a "merger of equals." Caremark fell $1.06, to $48.17.

CVS dropped $2.32 to $29.06.

MasterCard rose $10.97, to $85.07, after its third-quarter profit climbed 82 percent, beating analysts' estimates.

Marsh & McLennan rose 96 cents, to $30.40, after its third-quarter profit more than doubled.

Papa John's International fell for a second day, dropping $4.37, to $32.33, after the pizza chain operator reported a 1.1 percent decline in October same-store sales, its first decline in 22 months.

Indexes

New York Stock Exchange composite index fell 56.84, to 8718.14.

American Stock Exchange index fell 16.40, to 1948.95.

Russell 2000 index of smaller-company stocks fell 14.69, to 752.15.

Volume

NYSE: 2.92 billion shares, up from 2.78 billion on Tuesday. Decliners outnumbered advancers 13 to 7.

Nasdaq: 2.11 billion shares, up from 1.96 billion. Decliners narrowly outnumbered advancers 8 to 3.

Commodities

Crude oil for December delivery: $58.71, down 2 cents.

Gold for current delivery: $616.60 a troy ounce, up from $601.70 on Tuesday.


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