September 22, 2014 / 11:33 AM / 6 years ago

Housing data hits Wall Street; S&P has worst day since August 5

NEW YORK (Reuters) - U.S. stocks closed lower on Monday, with the S&P 500 suffering its biggest one-day decline since early August, as the latest housing data came in much weaker than expected, raising new concerns about the rate of growth in the economy.

Equities were also pressured after China’s finance minister indicated the country would not increase stimulus measures in response to some weak data of its own.

Existing home sales fell 1.8 percent in August, far from the growth of 1 percent that had been expected. An index of housing shares .HGX lost 2 percent as one of the weakest sectors on the day. Among specific stocks, D. R. Horton (DHI.N) lost 2.6 percent to $21.37, while Beazer Homes (BZH.N) was off 2.8 percent at $18.09 and Toll Brothers (TOL.N) shed 3.1 percent to $32.41.

The housing number “points to less strength in the U.S. recovery,” said Rex Macey, chief allocation officer at Wilmington Trust Investment Advisors in Atlanta, Georgia. “Housing is just too important to the economy, and to have this kind of weakness puts a pretty dark cloud over the market.”

In China, Finance Minister Lou Jiwei said the country would not dramatically alter its economic policy because of any one economic indicator. The comments come as recent data has been weak, leading many analysts to lower their growth forecasts for the country.

The Bank of New York Mellon’s index of Chinese American Depositary Receipts .BKCN fell 2.1 percent.

The Dow Jones industrial average .DJI fell 107.06 points, or 0.62 percent, to 17,172.68, the S&P 500 .SPX lost 16.11 points, or 0.8 percent, to 1,994.29 and the Nasdaq Composite .IXIC dropped 52.10 points, or 1.14 percent, to 4,527.69. The day marked the biggest one-day decline for the S&P since Aug. 5, and the biggest for the Nasdaq since July 31.

With the day’s decline, the S&P 500 closed below its 14-day moving average for the first time since Sept. 15. The technical level is a key indicator of short-term momentum.

The day’s losses were broad, with all 10 primary S&P 500 sectors lower on the day. About 80 percent of stocks traded on the New York Stock Exchange closed lower, while 77 percent of Nasdaq-listed shares ended in negative territory.

Traders work on the floor of the New York Stock Exchange September 22, 2014. REUTERS/Brendan McDermid

Consumer discretionary .SPLRCD was the weakest sector on the day, down 1.5 percent. TripAdvisor (TRIP.O) fell 4.1 percent to $94.29 after the company’s Viator unit on Friday said the payment card and personal information of about 880,000 customers might have been breached.

In company news, Sigma-Aldrich SIAL.O soared 33.2 percent after German drugs and chemicals maker Merck KGaA (MRCG.DE) agreed to acquire the company for $17 billion in cash.

About 5.99 billion shares traded on all U.S. platforms, according to BATS exchange data, compared with the month-to-date average of 5.97 billion.

Editing by Nick Zieminski

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