Stocks' Weekly Loss Is First in a Month
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U.S. stocks fell for the first time in five weeks as a decline in crude oil prices hurt fuel producers and Standard & Poor's downgraded the credit ratings of 18 banks.
Exxon Mobil led energy companies in the S&P 500-stock index to the biggest drop among 10 industry groups as oil had its first weekly retreat in more than a month. Wells Fargo fell 5 percent and McLean-based Capital One Financial fell 7 percent after S&P said tighter regulation and increased market volatility may reduce their ability to repay debt.
The S&P 500 declined 2.6 percent, to 921.23, this week, paring its rebound from a 12-year low on March 9 to 36 percent. The Dow Jones industrial average fell 259.53 points, or 3 percent, to 8539.73. The Nasdaq composite index lost 1.7 percent, to 1827.47.
"A lot of investors have been skeptical recently of global growth," said Steven Neimeth, a fund manager at SunAmerica Asset Management in Jersey City, N.J.
Earnings of companies in the S&P 500 have dropped for a record seven straight quarters and will continue to fall before rebounding in the fourth quarter, according to analyst estimates compiled by Bloomberg.
Yields on Treasury securities were little changed as Federal Reserve purchases offset concern about the record pace of government debt sales to finance recovery measures.
The 10-year note's yield declined to 3.77 percent from 3.79 percent.
The Treasury will auction $31 billion of three-month bills and $30 billion of six-month bills tomorrow. They yielded 0.17 percent and 0.32 percent, respectively, in when-issued trading.
One-month bills will be sold the next day.
The Fed will probably keep its target rate for overnight lending between banks at zero percent to 0.25 percent when policymakers meet this week, according to economists' estimates.
-- Bloomberg News
