The broad indexes all saw 2% declines. The broad market has been quite strong this year, with the S&P 500 (SPX.X) hitting a record high last week, but investors were disappointed by a slower than expected economic growth rate in China and reported decline in confidence among home builders in the United States.
The National Bureau of Statistics of China said that its preliminary estimate for the country's GDP growth rate for 12 months through the end of the first quarter was 7.7%, which was a decline from a 7.9% growth rate for the previous quarter. The consensus among analysts polled by Thomson Reuters was for China's GDP growth rate at the end of the first quarter to be 8.0%.
Commodity prices plunged on Monday, Gold for June delivery on the COMEX dropping $140.30, or 9.3%, to $1,361.10 an ounce, with the China GDP number contributing to a hostile technical trading environment. Monday's epic slide followed a 5% drop for gold prices on Friday. Gold prices have declined by over $200 over the past two trading sessions. Monday's decline was the largest on a percentage basis since Feb. 28, 1983, when the price dropped 12.1%, according to Bloomberg data.Please see TheStreet's Gold Page for continuing coverage of this story. The continuing narrative of the U.S. housing recovery has led to a very strong overall market this year, especially for bank stocks, following a very solid 2012 for the banks. But on Monday, the National Association of Home Builders said that "increasing costs for building materials and rising concerns about the supply of developed lots and labor," were leading to a decline in confidence among home builders. The NAHB/Wells Fargo Housing Market Index reading for April was 42, declining from 44 in March and coming in below the level of 45 expected by economists. An index reading below 50 indicates that a majority of builders consider market conditions to be poor. Also on Monday, the Federal Reserve Bank of New York said that its April Empire State Manufacturing Survey showed that "conditions for New York manufacturers improved slightly. "The general business conditions index fell six points but, at 3.1, remained positive for a third consecutive month," the bank said. Economists had expected the general business conditions index for New York manufacturing for April to come in at a reading of 7.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV