By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Durable-goods orders drop in February; Kraft, Kofex up on
M&A news
NEW YORK (MarketWatch) -- U.S. stocks fell on Wednesday,
declining for the third straight session, as a selloff in
technology and biotech stocks pushed indexes lower.
The S&P 500 (SPX) fell 14 points, or 0.7%, to 2,077, with
eight of its 10 main sectors trading lower. Technology stocks were
hit hard, with the largest company on the index, Apple, Inc.
dropping more than 1%.
The Dow Jones Industrial Average (DJI) shed more than 150
points, or 0.9%, falling to 17,858. The Nasdaq Composite (RIXF)
fell the most, dropping 65 points, or 1.3%, to 4,927.92.
Biotechnology stocks sold off, with the iShares Nasdaq
Biotechnology ETF dropping 2.6%.
John Manley chief equity strategist at Wells Fargo Advantage
Funds, attributed the selling action to the jitters stemming from
uncertainty about the Fed policy and expectations that earnings
would be poor.
"We are in the pre-announcement period, when companies will
begin issuing warnings ahead of the earnings season and many
investors expect that the first-quarter earnings will be poor.
Typically, high-multiple stocks, such as biotechs and technology
stocks get clipped badly during such times," Manley said.
"There are also concerns that the Fed might be tightening too
soon, given very weak growth we are experiencing," Manley said.
Released ahead of the bell, orders for durable U.S. goods
(http://www.marketwatch.com/story/february-durable-goods-orders-drop-14-in-weak-report-all-around-2015-03-25)
fell by more than expected in February, suggesting businesses
remain reluctant to invest more aggressively.
Dan Greenhaus, chief global strategist at BTIG, said the market
is still digesting economic reports news in the wake of a Federal
Reserve that said it would be "data dependent" in determining the
pace of its first rate hike in nine years.
"Today's durable-goods orders were in line with poor data of
late, which suggest that the first-quarter GDP will be weak,"
Greenhaus said.
Charles Evans, president of the Chicago Federal Reserve,
speaking to press after a speech in London, warned that global
uncertainty is the biggest risk to the U.S. economy, advocating
interest rates stay low until 2016.
The dollar (DXY) shifted slightly lower Wednesday after data
showed German business confidence rose in March
(http://www.marketwatch.com/story/ifo-german-business-confidence-rises-again-2015-03-25)
for the fifth straight month, hitting its highest level since July
2014.
Stocks to Watch: Shares of Kraft Foods Group Inc.(KRFT) surged
35% in thin premarket activity after a merger was announced with
H.J. Heinz Company
(http://www.marketwatch.com/story/kraft-and-heinz-to-merge-in-deal-to-create-company-with-revenue-of-28-billion-2015-03-25).
Shares of Kofax Ltd.(KFX) were up 46% in premarket after the
software company agreed to be acquired by Lexmark International
(LXK) late Tuesday.
For more on notable movers, read Movers & Shakers column
(http://www.marketwatch.com/story/red-hat-apollo-education-pvh-earnings-in-focus-2015-03-24).
Other markets: European stocks edged lower. In Asia, the
Shanghai Composite Index snapped a 10-day winning streak, and the
Japan Nikkei 225 index edged up 0.2%.
Oil prices (CLK5) were higher ahead of crude-stockpile data from
the U.S. Energy Information Administration due later. Late Tuesday,
the American Petroleum Institute, an industry group, said its data
for last week showed a 4.8-million-barrel gain in crude-oil
supplies. Gold prices (GCK5) were moderately higher.
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