U.S. Stocks Drop


U.S. stocks fell for the first time in three days, pushed down by concern General Motors Corp. may file for bankruptcy and a plunge in energy shares following Merrill Lynch & Co.’s prediction that oil will hit $25 a barrel.

GM lost 16 percent after a person familiar with the matter said the largest U.S. automaker is exploring a reorganization with workers, creditors and lenders. Southwestern Energy Co., EOG Resources Inc. and Exxon Mobil Corp. slumped, sending the Standard & Poor’s 500 Energy Index to a 6.2 percent decline. Apple Inc. slipped 4.7 percent as Nokia Oyj said the global mobile-phone market will shrink 5 percent or more next year.

The S&P 500 lost 2.9 percent to 845.22. The Dow Jones Industrial Average fell 215.45 points, or 2.5 percent, to 8,376.24. The Russell 2000 Index of small U.S. companies fell 3.1 percent to 439.58. Indexes also dropped after the Labor Department said more Americans are collecting jobless benefits than at any time since 1982.

European stocks gyrated between gains and losses as concerns that more companies will reduce earnings forecasts offset interest-rate cuts to revive economic growth.

Europe’s Dow Jones Stoxx 600 Index dropped 0.1 percent to 198.06 at 3:54 p.m. in London, recouping earlier losses of as much as 1.7 percent. The Stoxx 600 climbed from its lows of the day after ECB President Jean-Claude Trichet said it may be possible for the central bank to purchase financial assets to boost growth.

National benchmarks advanced in 14 of the 18 western European markets. The FTSE 100 gained 0.4 percent, and France’s CAC 40 added 0.3 percent. Germany’s DAX increased 0.5 percent.


TradingEconomics.com, Bloomberg.com
12/4/2008 1:30:19 PM