Stocks Plunge on Weak Data, Greece Concerns
NEW YORK (TheStreet) -- Stocks sank Wednesday as disappointing economic data and intensifying protests in Greece rattled Wall Street.
All three major U.S. equity indexes retreated almost 2%, wiping out yesterday's strong gains, and setting stocks up for a seventh straight week of declines.
The Dow Jones Industrial Average slide 179 points, or 1.5%, to 11,897. The S&P 500 lost 22 points, or 1.7%, to 1265, and the Nasdaq Composite dropped 47 points, or 1.8%, to 2631. Volatility, as measured by the VIX Volatility Index, spiked at close to 20 for the first since late March.
News of a possible resignation by Greece's prime minister following violent union strikes sparked a selloff of the euro. By closing, the euro had fallen 1.8% against the dollar, which settled 1.5% higher against a basket of currencies. Hong Kong's Hang Seng lost 0.7% while Japan's Nikkei added 0.3%. The FTSE in London shed 1%, and the DAX in Frankfurt fell 1.3%. In the United States, Wall Street learned that manufacturing activity in the New York area slowed significantly in June. The Empire State manufacturing survey sunk to a negative reading of -7.8, from May's level of 11.9. Economists had expected the index to dip to a reading of 10 in June. The Federal Reserve said that industrial production grew by 0.1% in May, falling short of expectations for a 0.2% gain. Capacity utilization remained unchanged at 76.7% in May, which was downwardly revised from April's initial level of 76.9%. Economists had expected utilization to tick up to 77% in May, according to Briefing.com. The Bureau of Labor Statistics said consumer prices rose 0.2% in May, which was slightly ahead of the 0.1% uptick that economists had been expecting. Inflation over the past year has gained 3.6%, despite the recent easing of gas prices. The National Association of Home Builders said its housing market index fell to a reading of 13 in June, from May's level of 16. The market had been anticipating no change from May's reading, according to Briefing.com.
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