By Rita Nazareth
Nov. 29 (Bloomberg) -- U.S. stocks fell, sending the Dow Jones Industrial Average toward its lowest close in seven weeks, as Ireland?s bailout failed to ease investor concern that Europe?s debt crisis may spread to the southern region.
Hewlett-Packard Co., Boeing Co. and Chevron Corp. slumped at least 1.7 percent, leading declines in the Dow. Newmont Mining Corp. and Alcoa Inc. dropped more than 1 percent as the U.S. dollar rallied, sending metals prices lower. Amazon.com Inc. gained 1 percent after the National Retail Federation reported a 6.4 percent increase in retail sales over the weekend.
The Standard & Poor?s 500 Index slipped 0.8 percent to 1,179.53 as of 10:37 a.m. in New York. The Dow lost 122.76 points, or 1.1 percent, to 10,969.66, the lowest level since Oct. 7 on a closing basis.
?There seems to be plenty to bother the market,? said E. William Stone, who oversees about $105 billion as chief investment strategist at PNC Wealth Management in Philadelphia. ?There?s concern about the European financial crisis affecting healthier economies and the viability of the euro. In the U.S., we?ve got a decent batch of retail numbers to keep the ball rolling. Still, I?m not sure that the market is going to be happy with much of anything right now.?
The S&P 500 has fallen 3 percent since reaching a two-year high on Nov. 5 amid concern the sovereign-debt crisis will spread to southern Europe and speculation China will raise interest rates to tame inflation. Stocks extended losses on Nov. 23 after North Korea shelled a South Korean island.
Technical Levels
The S&P 500?s decline sent the index below its 50-day moving average of about 1,176 for the first time since September, data compiled by Bloomberg show. Technical analysts who base investment decisions on price charts say retreats below such levels often lead to faster declines.
Global stocks have dropped for three straight weeks, pushing the MSCI World Index down 4.5 percent since Nov. 5, on concern the European sovereign-debt crisis that pushed Greece and Ireland to seek aid is spreading. Ten-year bond yields soared in Portugal, Spain and Italy last week while the euro slipped to $1.3241 against the dollar, from $1.4282 Nov. 4.
Ireland, swamped by the bursting of a decade-long real- estate bubble and unemployment approaching 14 percent, became the second country to tap European assistance. The government said it will pay average interest of 5.8 percent on the package, which breaks down to 45 billion euros ($60 billion) from European governments, 22.5 billion euros from the International Monetary Fund and 17.5 billion euros from Ireland?s cash reserves and national pension fund.
HP Sued
Hewlett-Packard declined 1.3 percent to $42.65. The world?s biggest computer maker was sued by shareholders seeking information about the company?s ouster of former Chief Executive Officer Mark Hurd.
Boeing, the world?s largest aerospace company, fell 1.7 percent to $63.71. Chevron, the second-biggest U.S. energy company, lost 1.7 percent to $80.67.
Raw-materials producers had the biggest decline in the S&P 500 among 10 industries, slumping 1.5 percent. Metals prices dropped as the euro fell to the lowest level in more than two months against the dollar.
Newmont Mining, the largest U.S. gold producer, lost 1.7 percent to $57.55. Alcoa, the largest U.S. aluminum producer, fell 1.1 percent to $13.02.
Amazon.com, the largest online retailer, rose 1.6 percent to $180.09. Abercrombie & Fitch Co., the teen clothing retailer, added 1.5 percent to $49.17.
Holiday Spending
The average American shopper spent 6.4 percent more than last year over the holiday weekend, the NRF said yesterday. U.S. retail sales during Thanksgiving weekend totaled $45 billion, the Washington-based group said, citing a survey conducted by BIGresearch. The number of customers shopping on Thanksgiving Day more than doubled over the past five years, the group said.
?Overall early signs show a year-on-year pick-up in retail spending, with consumers very deal-driven, but spending more on themselves and having some pent-up demand,? wrote a research team at Macquarie Group Ltd. in a report today.
Reports on manufacturing and payrolls are among releases this week that may shed light as to whether a rebound in the U.S. economy is faltering.
--With assistance from Alexis Xydias in London. Editors: Stephanie Borise
To contact the reporter on this story: Rita Nazareth in New York at rnazareth@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net.
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