The S&P 500 suffered its worst decline since November of last year with a decline of 2.30%. The Dow was off by 1.79%. All sectors suffered losses today but the selling was magnified in the commodities-linked stocks. Just 7 stocks in the S&P 500 closed higher today. Selling intensified in the final hour of trading after news of the bombing in Boston broke.
Commodities were sold off in response to weak economic data from China. The best performing sectors, on a relative basis, were the risk off areas of consumer staples, healthcare, and telecom while the lagging sectors were materials, industrials, and energy. Telecom was helped by the offer from DISH for Sprint for $25.5 billion. Healthcare was helped by the acquisition of San Diego health care company Life Technologies for $76 a share.
The weak economic news from China led to selling at the open in commodities. Selling in the area only intensified throughout the day. Gold closed lower by more than 8% and silver was off by better than 11%. Crude came off sharply ending the day lower by 3.5%.
Economic news from the U.S. was also disappointing. The Empire State manufacturing survey came in weaker than expected. This is the most recent in several economic releases that have disappointed.
Financials got off to a solid start as the market took the earnings release from Citigroup favorably. Regional banks sold off sharply after a key regional bank, Webster Financial, reported disappointing earnings. Most regional banks were off between 2% and 4%.
Several industrial names moved sharply higher through resistance levels the last two days of trading last week. They moved sharply lower today on fears of slowing global growth. Several major industrial stocks will report quarterly earnings on “Super Friday” of this week. Most of those sold off sharply. The railroad space, a leading group in the sector for months, sold off hard today.
Weaker than expected housing related numbers provided a catalyst for selling in the homebuilding space today. Some homebuilders said that margins were lower than expected due to increasing costs for building products.
Energy was routed today with crude off by 3.5% and natural gas lower by 1.75%. Coal stocks, refiners, and drillers were the laggards in the space.
Source: PFS Group
