1st LD Writethru: U.S. stocks extend losses for 4th straight day
Xinhua, January 15, 2015 Adjust font size:
U.S. stocks continued to drop Wednesday amid mixed earnings of American banks, soft data and concerns about global economy.
The Dow Jones Industrial Average slipped 186.59 points, or 1.06 percent, to 17,427.09. The S&P 500 fell 11.76 points, or 0.58 percent, to 2,011.27. The Nasdaq Composite Index dipped 22.18 points, or 0.48 percent, to 4,639.32.
JPMorgan Chase & Co., the largest U.S. bank by asset, posted Wednesday net income of 4.9 billion U.S. dollars for the fourth quarter, or 1.19 dollars per diluted share, down from 5.3 billion dollars, or 1.30 dollars per share, in the fourth quarter of 2013. The company's results were hurt by expensive legal costs. In response, its shares slumped 3.45 percent to 56.81 dollars apiece.
Shares of Wells Fargo, the biggest U.S. mortgage lender, fell 1. 16 percent to 51.25 dollars apiece after the company delivered quarterly earnings in line with market expectations.
The financials sector decreased 1.42 percent Wednesday, the biggest laggard among the S&P 500's 10 sectors.
On the economic front, U.S. retail and food services sales lost 0.9 percent in December on a seasonally adjusted basis, the biggest decline since January 2014, said the U.S. Commerce Department. The drop was much bigger than analysts' expectations.
Separately, the Commerce Department said U.S. business inventories were up 0.2 percent in November from October, lower than market consensus of 0.3 percent.
"A weak finish for fourth quarter retail sales suggests consumers may not be quite as happy about lower gas prices as thought," said Chris Low, chief economist at FTN Financial, in a note.
Additionally, the price index for U.S. imports fell 2.5 percent in December, the biggest decline in six years, the U.S. Labor Department said. Meanwhile, export prices dropped 1.2 percent last month.
Dampening investor sentiment, the World Bank lowered its global economy growth forecasts for 2014 and 2015 Tuesday. In its latest flagship report Global Economic Prospects, the World Bank projected the global economy to grow 2.6 percent in 2014 and 3 percent in 2015, down 0.2 percentage point and 0.4 percentage point respectively from its June forecasts.
Overseas markets saw a broad-based decline Wednesday following the World Bank report.
However, the Federal Reserve's Beige Book released at 2:00 p.m. local time soothed anxious investors to some extent, which helped the three major indices recoup part of their losses to come off session lows.
The report showed that the world's largest economy continued to expand during the reporting period of mid-November through late December, with most Districts reporting a "modest" or "moderate" pace of growth. Endite