US stocks lower

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IOL wall street THE PHOTO HOLIC File image

US stocks fell in early trade Monday amid more weak signals on the economies of Japan and China and as rates on Spanish and Italian debt pushed higher in a new show of market skepticism over euro crisis cures.

Trade was heavy in healthcare company Amerigroup as it agreed to a $4.9 billion takeover bid from Wellpoint, sending its stock up 38 percent to $88.75, below the $92 per-share value of the offer. Wellpoint was up 3.6 percent.

At 16:00 SA time the Dow Jones Industrial Average was down 65.84 points (0.52 percent) to 12,706.63.

The S&P 500 lost 6.08 (0.45 percent) to 1,348.60, while the tech-rich Nasdaq slid 13.80 (0.47 percent) to 2,923.53.

The S&P's weakness came “in response to weak economic readings out of China and Japan.” according to the Hightower Report.

“However, comments from two Fed members talking in favor for another round of quantitative easing to support growth might have offered a level of support for the index.”

Japan posted a set of weak economic figures on trade and industrial orders, while China's Premier Wen Jiabao said Sunday that the Chinese economy still faces “relatively big” downward pressure.

The plight of Spain and Italy also held attention as investors sold down their debt, pushing yields to near unsustainable levels again.

Boeing led the seven gainers of the Dow 30 with an 0.5 percent rise after announcing a $7.2 billion order for 75 of its 737 MAX jets from Air Lease Corporation.

Chevron and ExxonMobil were leading losers, each dropping 1.1 percent.

Bond prices edged higher with the dollar. The yield on the 10-year Treasury fell to 1.53 percent from 1.54 percent Friday, while the 30-year moved to 2.65 percent from 2.66 percent.

Bond prices and yields move in opposite directions. - Sapa-AFP

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