US stocks : Dow off 0.8 pct

Feb 21 2013, 03:57 IST
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Dow Jones industrial average dropped 108.13 points to 13,927.54 at the close. (Reuters) Dow Jones industrial average dropped 108.13 points to 13,927.54 at the close. (Reuters)
SummaryDow Jones industrial average dropped 108.13 points to 13,927.54 at the close.

about 6 percent so far this year. Many analysts have been expecting the market to ease after the Dow and the S&P 500 came close to all-time highs.

Energy companies' shares were among the weakest, hurt by disappointing results in the sector and a 2 percent drop in crude oil prices. The Energy Select Sector SPDR exchange-traded fund fell 2.1 percent.

Newfield Exploration tumbled 9.3 percent to $24.75 while Devon Energy Corp dropped 6.6 percent to $56.57. Both companies posted fourth-quarter losses, with Devon hurt as it wrote down the value of its assets by $896 million because of weak natural gas prices.

Earlier in the day, unconfirmed rumors that a troubled hedge fund was selling assets added some downward pressure to the market. The rumors appeared to be unfounded.

"I heard the chatter about a hedge fund liquidating things today but how big, I don't know. Certainly, it sparks concern," said Michael James, senior trader at Wedbush Morgan in Los Angeles.

Housing shares also declined, pressured by weaker-than-expected results at Toll Brothers Inc and a drop in groundbreaking to build new U.S. homes, also known as housing starts, in January.

Toll Brothers' stock fell 9.1 percent to $33.56, but is up about 4 percent so far this year, building on a jump of nearly 60 percent in 2012. The Dow Jones U.S. Home Construction index lost 6.7 percent.

"Valuations appear a bit high at these levels, and if I was in a name that had seen a huge run, I'd want to take some chips off the table," said Matt McCormick, money manager at Bahl & Gaynor in Cincinnati.

The Dow's losses were limited by Boeing Co, up 0.2 percent at $74.78 after a source told Reuters that the company had found a way to fix battery problems on its grounded 787 Dreamliner jets. Concerns over that line have weighed on Boeing recently, contributing to a 2 percent drop in the stock's price in January.

Shares of OfficeMax Inc fell 7 percent to $12.09 while Office Depot slid 16.7 percent to $4.18 as the companies announced a $1.2 billion merger agreement. The shares had surged in Tuesday's session after a source said a deal would be announced.

Rival Staples Inc fell 7.2 percent to $13.60 and ranked as one of the S&P 500's biggest decliners.

About 7.49 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, above the 6.48 billion daily average so

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