U.S. stocks extend losses on downbeat data

U.S. stocks continued to drop in the morning session on Wednesday, as data showed that U.S. manufacturing sector remains weak.

At midday, the Dow Jones Industrial Average fell 39.60 points, or 0.22 percent, to 17,971.54. The S&P 500 dipped 7.21 points, or 0.34 percent, to 2,084.29. The Nasdaq Composite Index tumbled 50. 84 points, or 1.02 percent, to 4,943.88.

New orders for manufactured durable goods in February unexpectedly decreased 3.2 billion dollars, or 1.4 percent, to 231. 3 billion dollars, well below market expectations of a modest gain, the U.S. Commerce Department said Wednesday.

"While we may see improvement in durable orders over the next several months, robust growth is not in the cards given the global economic situation. Weak foreign demand, tough competition from cheaper imports and lower commodity prices will continue to weigh on domestic manufacturers in the foreseeable future," said Jay Morelock, an economist at FTN Financial, in a note.

In corporate news, H.J. Heinz, owned by P-E firm 3G Capital and Berkshire Hathaway, announced Wednesday that it had entered into a definitive merger agreement with Kraft to create The Kraft Heinz Company, forming the third largest food and beverage company in North America.

Heinz shareholders will own a 51 percent stake in the combined company, while Kraft shareholders will hold a 49 percent stake and receive a special cash dividend of 16.50 dollars per share. Shares of Kraft rocketed 39.80 percent around midday. Endite