US market indexes decline for 3rd day

Associated Press

NEW YORK

Investors dumped high-flying technology and biotech companies and sent the stock market down for a third-straight day Wednesday.

Major indexes drifted lower in early trading, following news that orders for long-lasting U.S. goods sank last month. The selling gathered strength in the afternoon, with companies such as Avago Technologies and Skyworks Solutions losing the most.

Peter Cardillo, chief market economist at Avalon Partners, a New York brokerage, said the market’s fall was driven by big investors selling some of their winnings before the first quarter closes next week. The drop in factory orders also raised concerns that a slowdown in economic activity could continue.

“A weak first quarter could spill into the second quarter,” Cardillo said, “and that probably leads to a poor earnings season.”

The Standard & Poor’s 500 index lost 30.45 points, or 1.5 percent, to 2,061.05. The Dow Jones industrial average fell 292.60 points, or 1.6 percent, to 17,718.54, while the Nasdaq composite fell 118.21 points, or 2.4 percent, to 4,876.52.

It was the worst day for stocks since March 10, when speculation over the Federal Reserve’s plans to raise interest rates helped knock the S&P 500 down 1.7 percent.

Jack Ablin, chief investment officer at BMO Private Bank, said he thinks it’s going to be tough for the market to sustain a strong run higher. Major indexes still trade near record highs reached at the start of the month, even though analysts expect earnings to shrink in the first half of the year. That makes the typical stock look pricey.

“We’re going to have a difficult time continuing to make new highs if the underlying economy isn’t following the direction of the market,” he said. “At some point we’re going to hit the intersection of reality and expectations.”

Before the market opened Wednesday, the Commerce Department reported that orders to U.S. factories for long-lasting manufactured goods fell in February for the third time in four months. Demand for commercial aircraft, cars and machinery waned.