U.S. stocks post biggest weekly loss in five weeks as economic uncertainty rises
U.S. stocks slid last week on concerns that the Federal Reserve's stimulus plan and a surge in jobless claims mean the economic recovery is in jeopardy, sending the Standard & Poor's 500-stock index to its biggest loss in five weeks.
Technology shares fell more than any other sector in the S&P 500, with Hewlett-Packard losing 13 percent following the resignation of its chief executive. Cisco Systems, the world's largest maker of networking equipment, plunged 11 percent after its sales projection missed estimates.
The S&P 500 tumbled 3.8 percent to 1079.25, the lowest level since July 21. The Dow Jones industrial average decreased 350.41 points, or 3.3 percent, to 10,303.15. Twenty-six of the Dow's 30 blue-chip companies fell, including Alcoa and J.P. Morgan Chase, which dropped 8.1 percent and 7.2 percent, respectively.
"Investors are reassessing the global growth and earnings story," said Stephen Wood, chief market strategist for Russell Investments. "We're in a stage after stabilization where markets are looking for growth and the Fed confirmed that growth is going to be more difficult to generate."
More than $1.5 trillion has been erased from the value of global equities since Tuesday, when the Fed reversed its plans to exit from aggressive monetary stimulus and decided to keep its bond holdings level to support a faltering recovery. In April, the S&P 500 had rallied as much as 80 percent from the 12-year low reached in March 2009, but recent losses have pared that gain to 60 percent.
The Treasury will sell $30 billion in three-month and six-month bills Thursday. They yielded 0.15 percent and 0.19 percent, respectively, in when-issued trading.
-- Bloomberg News