US stocks fell after the Dow Jones Industrial Average reached above 16,000 for the first time in first hours of trade yesterday, raising concern that equities have risen faster than economy could sustain.
The Standard & Poor’s 500 Index declined 0.4% to 1,791.53 at 4 p.m. in New York. Earlier, the benchmark index topped 1,800. About one in three stocks rose in the gauge. The Dow average gained 14.32 points, or 0.1%, to 15,976.02. Nasdaq technology benchmark retreated almost 1% to 3,949.07. About 6 billion shares changed hands on U.S. exchanges, in line with the three-month average.
“The reality is youve had really steady rallies for such a long period of time, so you do get these quick little sell-offs,” said to Wall Street Journal, Bill Nichols, senior managing director in equity trading at Cantor Fitzgerald LP.
China’s leaders committed to liberalize more private investment in state-controlled industries and expand farmers’ land rights as part of the ruling Communist Party’s biggest package of economic reforms since 1990. Chinese stocks rose, with the benchmark index for mainland companies in Hong Kong surging the most since December 2011.
In corporate world, 80% of industries reported losses after yesterdays trade.
Microsoft declined 1.7% to $37.20. Bank of America analyst Kash Rangan cut the shares to “under-perform” from “neutral”, citing the risk that the board will select a chief executive officer that disappoints investors.
Tesla Motors Inc. fell 10%to $121.58. Safety officials in California are investigating an industrial accident at the company’s sole Model S plant that injured three workers. The electric-car maker led by Elon Musk has fallen 25% since November 1.
J.P. Morgan Chase gained 1.6%, to 55.74 after saying that it reached an agreement to pay $4.5 billion to investors seeking to recover losses from mortgage-backed securities sold before the financial crisis.
Boeing added 1.7% to $138.36. The company took an early lead over rival Airbus SAS in the biennial Dubai expo, signing up Etihad Airways PJSC for its new 777X wide-body planes as well as for more 787 Dreamliners. Emirates Airlines, the fast-growing Dubai-based carrier, also made a commitment to buy 150 Boeing 777X long-range jets in a deal that may become the US manufacturer’s largest single commercial aircraft order, worth $55.6 billion at regular price.
Nvidia Corp. slumped 2.4% to $15.78. The shares were cut to “underweight”, or “sell”, from “equal-weight”, or “hold”, at Morgan Stanley.