US stocks slip after two record days

09:56 | 13/04/2013
US stocks closed lower Friday after two record-setting days, with sentiment dulled by poor US retail sales figures for March and more prospects of slow economic growth around the world.


Traders work on the floor of the New York Stock Exchange. (AP/Richard Drew)

NEW YORK: US stocks closed lower Friday after two record-setting days, with sentiment dulled by poor US retail sales figures for March and more prospects of slow economic growth around the world.

The Dow Jones Industrial Average finished virtually flat, down 0.08 at 14,865.06.

The broad-based S&P 500 fell 4.52 points (0.28 percent) to 1,588.85, while the tech-rich Nasdaq Composite lost 5.21 (0.16 percent) at 3,294.95.

The losses came after the Commerce Department reported a 0.4 percent drop in March retail sales compared with February, and a media report said that the IMF has lowered its forecast for US growth to 1.7 percent.

"This doesn't change our view for the first quarter but it does indicate slower momentum as the second quarter began," Jennifer Lee of BMO Capital markets commented on the retail sales data.

Some weak signs in the first-quarter results from two banks also kept buying on hold.

Wells Fargo's (-0.8 percent) first quarter profits rose 22 percent, but the bank, the largest issuer of home loans, said its pipeline of new mortgages was slowing.

Earnings at JPMorgan Chase (-0.6 percent) rose by 33 percent, helped by a 90 percent decline in the company's litigation costs and improving credit quality. But chief executive Jamie Dimon said lending to small businesses remains weak with the uncertainty over economic growth.

That spilled over to other banks yet to report: Bank of America lost 0.8 percent, Morgan Stanley 2.0 percent and Citigroup 0.2 percent.

Gold-related shares continued to fall after the gold price plunged nearly 5 percent to $1,486.90 per ounce, helped by news that struggling Cyprus will dump its gold reserves onto the market.

Barrick Gold lost 8.5 percent, and Freeport McMoRan gave up 2.7 percent.

Oil companies also lost in a general commodities rout. ExxonMobil slipped 0.3 percent and Chevron lost 0.8 percent.

Bond prices rose. The yield on the 10-year Treasury dropped to 1.72 percent from 1.79 percent late Thursday, while the 30-year bond sank to 2.92 percent from 3.00 percent. Bond prices move inversely to yields.

AFP

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