U.S. stocks edged lower Monday for a third day after analysts reduced earnings estimates for securities firms while manufacturing report was not as bad as forecast, while a separate report on construction showed a steep weakness in spending on non-residential projects.
The business spending shortfall is the most significant part of today's report, as it suggests that we are finally seeing a turn in this surprisingly robust GDP [Gross Domestic Product] component, wrote analysts at Action Economics.
The Dow Jones was down nearly 100 points from earlier trade and was recently down 45.10 points or 0.4 percent to 12,221.29 at 1:45 pm in New York. The Standard & Poor's 500 index was down 1.84 points of 0.1 percent to 1,328.79 while the Nasdaq lost 10.81 points to 0.5 percent to 2.260.67.
On the New York Mercantile Exchange, gold and crude-oil futures soared to new highs, fueled by sharp weakness in the U.S. dollar. Gold for April delivery hit a record of $992 an ounce, while crude oil for April delivery soared to a record of $103.95 a barrel.
In more recent trade, gold was up $12.20 at $987.20 an ounce, while crude climbed $1.68 to $103.52 a barrel.
Volume on the New York Stock Exchange reached 630 million, and declining issues outran 8 to 7. On the Nasdaq, 416 million shares were exchanged, and declining stocks outpaced those advancing about 4 to 3.
Financial shares in the S&P 500, which are down 13 percent this year, fell for a third day after analysts at Merrill Lynch & Co., Oppenheimer & Co. and Sanford C. Bernstein & Co. cut their profit estimates for brokerages.
Citigroup, the biggest U.S. bank by assets, retreated 61 cents to $23.10. Bear Stearns lost $2.29 to $77.57. Goldman, the biggest U.S. securities firm by market value, dropped $3.18 to $166.45. Lehman Brothers Holdings Inc. fell $2.51 to $48.48.
The Institute for Supply Management reported U.S. manufacturing contracted in February, with its index falling to 48.3 percent from 50.7 percent in January. The reading was at its lowest level since April 2003, but was better than the 47.5 percent forecast by many analysts.
Other data included a Commerce Department report that spending on U.S. construction fell 1.7 percent in January.