Dow Jones:11,934.58 (-115.42) S&P 500:1,268.45 (-33.86) Nasdaq: 2,652.89.56 (-25.49)
US STOCKS retreated yesterday, sending the Standard and Poor’s 500 Index lower for a third straight day, as concern about the European debt crisis intensified and Oracle dragged down technology shares.
Technology companies in the S&P 500 dropped 1.8 per cent as a group. Oracle, the largest maker of database software, sank 4.1 per cent after reporting lower hardware sales. Micron Technology. tumbled 14 per cent as the maker of computer-memory chips reported sales and profit that missed estimates.
Equity futures rose earlier after the commerce department said orders for durable goods, or equipment meant to last at least three years, rose 1.9 per cent, beating the median economist forecast of 1.5 per cent.
A gauge of technology companies in the S&P 500 dropped 1.8 per cent as 70 of its 74 stocks retreated. Oracle slumped 4.1 per cent to $31.14.
Chief executive officer Larry Ellison bought Sun Microsystems last year to capitalise on demand for the servers and databases used in data centres. While the hardware results may reflect Oracle’s effort to pare less-profitable machines from the line-up, they were disappointing enough to overshadow better-than-predicted performance in profit and sales of new software licences.
Micron Technology tumbled 14 per cent to $7.21. The price of dynamic random access memory, or Dram, for personal computers dropped as supplies increased and demand from makers of consumer laptops and desktop PCs remained sluggish, the company said.
Orders were also slowing for chips used in inexpensive mobile phones, pushing down prices, Micron chief executive officer Steve Appleton said.
Bank of America, the largest US lender by assets, retreated 1.8 per cent to $10.52. JPMorgan declined 1.5 per cent to $39.49.
The pace of profit growth by US companies will slow as the cost of labour increases and stock investors should be wary of sovereign-debt concerns, according to Citigroup’s Tobias Levkovich.
Mr Levkovich recommended avoiding consumer-discretionary stocks, including retail and media companies, as well as healthcare shares as the government considers budget cutbacks. – (Bloomberg)
