US stocks sink on economic, Ebola worries

SHAFAQNA (Shia International News Association)

Wall Street stocks finished sharply lower Wednesday following mixed US economic data amid worsening anxiety over global economic growth and the first confirmed Ebola case in the United States.

The Dow Jones Industrial Average fell 238.19 points (1.40 percent) to 16,804.71.

The broad-based S&P 500 tumbled 26.13 (1.32 percent) to 1,946.16, while the tech-rich Nasdaq Composite Index sank 71.30 (1.59 percent) to 4,422.09.

US private-sector employment increased by 213,000 in September from August, according to payroll company ADP.

But the Commerce Department reported that construction spending in August fell unexpectedly, by 0.8 percent, while a report from the Institute for Supply Management pointed to a modest slowdown in September manufacturing activity compared with the prior month.

Analysts described worries over a range of issues, including the strengthening US dollar, lower oil prices that have hit energy equities and the first confirmed US case of the Ebola virus.

Michael James, managing director of equity trading at Wedbush Securities, described market sentiment as “terrible.”

The losses were fairly broad-based. Virtually all of the 30-member Dow dropped, including Intel (-2.4 percent), Johnson & Johnson (-2.2 percent), JPMorgan Chase (-0.8 percent) and Wal-Mart Stores (-0.5 percent.)

Airline stocks suffered on speculation the US Ebola case would result in lower passenger traffic. Delta Air Lines fell 3.5 percent, while United Airlines lost 2.8 percent.

Tekmira Pharmaceuticals, which is developing treatment for the Ebola virus, soared 18.2 percent.

General Motors jumped 1.7 percent as it outlined plans to achieve 9.0-10.0 percent pre-tax profit margins by the early 2020s. Key elements included returning the European unit to profitability in 2016 and growing China sales to more than 30 million vehicles in 2018.

Cola-Cola gained 0.2 percent to become the lone Dow member to finish higher after bowing to criticism from Warren Buffett and others, trimming its executive compensation plan.

The New York Times Company jumped 9.6 percent over plans to eliminate 100 newsroom jobs to cut costs, a reduction representing around 7.5 percent of the newsroom staff.

Bond prices leaped higher. The yield on the 10-year US Treasury fell to 2.40 percent from 2.51 percent Tuesday, while the 30-year yield declined to 3.11 percent from 3.21 percent. Bond prices and yields move inversely.

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