US banks were the S&P 500’s worst-performing sector. Investors feared that weak euro zone growth would hamper countries dealing with heavy debt loads and the banks exposed to those debts.
“We’re very concerned around the markedly deteriorating credit fundamentals in Europe,” said Steven Baffico, chief executive officer at Four Wood Capital Partners in New York.
Data showing weakness in the euro zone services and manufacturing sectors overshadowed the day-old deal to bail out Greece.
After touching a near seven-month high on Tuesday, the KBW bank index 2 per cent. A key European bank index declined 2.5 per cent.
The S&P 500 index failed again to hold above 1,360, the high reached last May and a key resistance point that could spark further gains if broken. The benchmark index is up about 8 per cent for the year and gained more than 20 per cent from its October lows.
The Dow Jones industrial average lost 27.02 points, or 0.21 per cent, to 12,938.67. The S&P 500 Index dropped 4.55 points, or 0.33 per cent, to 1,357.66. The Nasdaq Composite fell 15.40 points, or 0.52 per cent, to 2,933.17.
Oil services companies rose, partly offsetting the decline by banks. Drilling contractor Nabors Industries rose 7 per cent to US$21.78 a day after its operating results topped Wall Street expectations and as the chief executive detailed a retooling of the company.
The PHLX oil services sector index rose 1.7 per cent.
Home builder stocks fell, with the PHLX housing sector index down 1.4 per cent. Data showed US home resales surged to a 1-1/2-year high in January but came in below forecasts.
Dell Inc was one of the biggest drags on the S&P, tumbling 5.8 per cent to US$17.10 in volume 2.5 times above its recent daily average. The world’s No. 3 personal computer maker late Tuesday forecast revenue below expectations. The NYSE Arca computer hardware index lost 1.8 per cent.
After the market’s close, shares of computer maker Hewlett-Packard fell 1.4 per cent after reporting quarterly revenue below expectations.
About 6.3 billion shares changed hands on the New York Stock Exchange, the Nasdaq and Amex, compared with last year’s daily average of about 7.8 billion shares.
Slightly more than three shares fell for every two that rose on the NYSE, while on the Nasdaq more than two fell for every advancing issue.
According to Thomson Reuters data through yesterday morning, of the 424 companies in the S&P 500 that have reported earnings, 64 per cent have topped analysts’ expectations, which is below the 70 per cent beat rate for the past four quarters but above the median of 62 per cent since 1994. — Reuters
