Weak Economic Data Slams Wall Street

By Markets FOXBusiness

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Stocks pared significant losses Wednesday, but still closed deep in negative territory, as disappointing economic reports reignited growth worries.

Today’s Markets

The Dow Jones Industrial Average (DJI) shed 173 points, or 1.1%, to 16,141. The S&P 500 (GSPC) fell 15.2 points, or 0.8%, at 1,862. The Nasdaq (IXIC) dropped 11.9 points, or 0.3%, to 4,215.

The Dow completed its fifth consecutive day of red ink amid growing concerns over the strength of the U.S. recovery and economic growth overseas. The blue-chip index fell 457 points in midday trading, the largest intraday drop in more than three years when the Dow saw a 527-point plunge in September 2011.

In the wake of the steep selloff, the CBOE’s volatility index reached its highest level since December 2011. Traders piled into the safe-haven of U.S. Treasury bonds, pushing the yield on the 10-year note below 2% for the first time in 16 months.

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The Commerce Department said retail sales fell 0.3% in September compared to the prior month, marking the first negative reading since January. Economists were looking for a 0.1% decline.

Meanwhile, the U.S. producer-price index booked a surprise drop of 0.1% last month versus August. It was the first decline in more than a year.

Fears over the spread of the Ebola virus, which has killed over 4,000 people in Africa, are also casting a shadow over the market. The Centers for Disease Control and Prevention said a second nurse who treated the first case of Ebola in the U.S. tested positive and recently traveled on a flight from Cleveland to Dallas.

On the corporate front, Bank of America (BAC) shares slipped 4.6% after reporting a much smaller third-quarter profit. The results included legal costs tied to a $16.7 billion settlement with the Department of Justice. The nation’s No. 2 bank also reported lower-than-expected revenue.

Railroad operator CSX (CSX) beat expectations for both earnings and revenue, and shares ended the day 1.1% higher. During its earnings call, CSX declined to comment on reports that it rebuffed a merger proposal from Canadian Pacific Railway (CP).

Time Warner (TWX) was another bright spot Wednesday. The media giant rose 2.2% on word that HBO, Time Warner’s subscriber channel, will launch a standalone online video service next year.

In commodities, West Texas Intermediate crude oil fell six cents to $81.78 a barrel, the lowest since June 2012. Wholesale New York Harbor gasoline was down about three cents at $2.15 a gallon.