Last updated: April 1, 2013 9:36 pm

Poor economic data weigh on Wall St

Wall Street turned away from record levels on Monday as investors pulled back from the US equity market following worse than expected manufacturing data.

The S&P 500, which finished last week at its highest closing level in history, lost 0.5 per cent to 1,562.17 on Monday.

The losses came as the latest reading of a closely-watched measure of US manufacturing activity suggested that the pace of expansion for the sector had slowed in March and came in below analysts’ consensus forecasts for the period.

The S&P 500 industrial sector was the worst performing industry group on the broad US benchmark, falling 1.1 per cent.

Among the biggest decliners on the day, land drilling contractor Nabors Industries fell 3.7 per cent to $15.62 as investors ditched shares in companies tied to the manufacturing sector. Mining equipment maker Joy Global declined 3 per cent to $57.75 and diesel engine manufacturer Cummins lost 2.7 per cent to $112.71.

Investors said US economic data would be critical to helping stocks push past their record levels from last week, given expectations that the upcoming quarterly earnings period for the nation’s largest companies would likely disappoint.

Oliver Pursche, a portfolio manager at Gary Goldberg Financial Services, said: “Unfortunately, as we enter the first-quarter earnings season, much of these gains may be retraces, as investors face the reality of a 0.7 per cent year-over-year earnings decline.

“Last week marked the end of a strong quarter for stocks and now investors are trying to figure out what to do next,” said JJ Kinahan, chief derivatives strategist at TD Ameritrade. “It is difficult to redeploy capital at these expensive levels and investors are closing out things that have performed well and thinking about sectors to go back to.”

The Dow Jones Industrial Average was the best performing of three major US benchmarks as the blue-chip measure finished the day marginally lower at 14,572.85. The Nasdaq Composite index was the worst performing and lost 0.9 per cent to 3,239.17.

Shares in eBay were a rare bright spot on the day for the technology sector as the online auction site received an upgrade from analysts at Canaccord Genuity after holding its analyst day last week in California. Analysts at JPMorgan told clients that the company said it planned to increase revenues by more than 50 per cent over the next three years. Shares rose 2.7 per cent to $55.71.

Despite the gains, the S&P 500 technology sector declined 1 per cent on the day as shares in the industry group were dragged lower by a drop in Apple’s price. Shares in Apple declined 3.1 per cent to $428.91 as the technology group took steps to repair relations with its China-based customers and apologised for its customer service in the region.

Netflix lost 3.6 per cent to $182.43 as investors cooled on the internet streaming and home DVD delivery company, which has gained more than $90 a share so far this year.

Cisco Systems fell 0.3 per cent to $20.83 in the first trading session since the network equipment company said it would increase its quarterly dividend by 3 cents to 17 cents a share.

Chesapeake Energy shed 0.3 per cent to $20.35 as the natural gas company continued its search for a new chief executive. Late last week, the company appointed its chief operating officer as its interim chief executive failing to find a replacement before the departure of its founder, Aubrey McClendon, at the end of March.

Tesla Motors jumped 15.9 per cent to $43.93 as the US electric carmaker said it expects to report its first quarterly profit in its 10 year history, bolstered by stronger than forecast sales of its vehicles.

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