U.S. Stocks Drop

U.S. stocks fell for a second day, led by energy producers and retailers, as oil's decline below $60 a barrel and lower-than-estimated earnings at Starbucks Corp. spurred concern that the economic slump is deepening.

Exxon Mobil Corp. and Chevron Corp. slumped more than 2 percent as oil declined on forecasts of slower demand growth. Starbucks Corp. slid 2.6 percent after the world's biggest chain of coffee shops predicted slowing sales and backed away from expansion plans. Goldman Sachs Group Inc. told clients to sell shares of Prudential Financial Inc., the second-biggest U.S. life insurer, pushing the stock down 12 percent.

The Standard & Poor's 500 Index dropped 2 percent to 900.54 at 9:38 a.m. in New York. The Dow Jones Industrial Average lost 163.76 points, or 1.9 percent, to 8,706.78, while the Nasdaq Composite Index fell 1.6 percent to 1,591.45.

Stocks fell in Europe and Asia, led by financial shares and commodity producers, on a worsening profit outlook and drop in oil and metals prices.

The MSCI World Index lost 1.7 percent to 924.59 at 12:25 p.m. in London, falling for the first time in three days. More than $28 trillion has been erased from the value of global equity markets as credit losses and writedowns topped $920 billion in the worst financial crisis since the Great Depression.

Europe's Dow Jones Stoxx 600 Index declined 3 percent with Erste Group Bank AG and BHP Billiton Ltd. losing at least 5 percent. The MSCI Asia Pacific Index dropped 3.6 percent as Australian business confidence fell to a record low.

U.K. stocks dropped for the first time in three days after reports showed home sales fell to the lowest in more than 30 years, consumer spending slowed and Morgan Stanley forecast the economy will shrink. The benchmark FTSE 100 Index retreated 124.47, or 2.8 percent, to 4,279.45 at 12:34 p.m. in London.

The MSCI Emerging Markets Index slumped 2.9 percent as stocks in Russia, the world's second-biggest oil producer, sent the Micex down 9.4 percent. The Dubai Financial Market General Index fell 7.3 percent to the lowest in almost four years, led by developers.

China's CSI Index slipped 1.1 percent, as export growth cooled to 19.2 percent in October from a year earlier. That compares with 21.5 percent in September.

TradingEconomics.com, Bloomberg.com
11/11/2008 7:07:53 AM