S&P 500 in third straight drop, J.C. Penney off late
NEW YORK (Reuters) - Stocks fell for the eighth day in the past 10 on Tuesday as uncertainty stemming from the political stalemate in Greece gave investors another reason to be cautious and sellers came out in force late in the session.
The S&P 500 fell for the third straight session as attempts to form a government in Greece fell apart, raising the possibility of a rejection of the bailout terms spelled out by the European Union for the fiscally troubled nation.
After holding near the unchanged mark for much of the session, stocks moved lower in the absence of positive news to turn the tide of negative sentiment.
"Those who are looking for a little bit of a bounce off the last eight trading sessions lost their nerve because there is really nothing out there to indicate the broader story has changed," said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.
The concerns about upheaval in the euro zone and its effect on the global economy weighed on energy and materials stocks, with U.S. crude down for the third straight day. The S&P energy index .GSPE and the S&P materials index .GSPM each dropped 1.5 percent.
Quarterly results helped boost retailers TJX (TJX.N), up 6.9 percent at $42.45, and Dick's Sporting Goods (DKS.N), up 5.9 percent at $50.05.
U.S. retail sales rose 0.1 percent in April, slightly below expectations. However, details in the Commerce Department's report indicating underlying strength in demand and a rebound in manufacturing activity in New York State calmed concerns that the economy was stalling.
The declines on Tuesday pushed the S&P 500 down more than 6 percent from its early April high, leaving some investors optimistic that the pullback may be nearing an end as stock prices become more attractive.
"We could go a little lower, but not much lower. It's hard to ignore the fundamentals - and clearly there are some good fundamentals and prices," said Mark Martiak, senior wealth strategist at Premier/First Allied Securities in New York.
Data showing an index of home builders' sentiment at a five-year high in May helped lift the sector's shares. The PHLX housing index .HGX advanced 0.6 percent. But Home Depot (HD.N) shares lost 2.4 percent to $48.67 and ranked as the biggest drag on the Dow after the home improvement retailer posted quarterly sales that fell short of Wall Street's expectations.
The Dow Jones industrial average .DJI dropped 63.35 points, or 0.50 percent, to close at 12,632.00. The Standard & Poor's 500 Index .SPX lost 7.69 points, or 0.57 percent, to 1,330.66. The Nasdaq Composite Index .IXIC fell 8.82 points, or 0.30 percent, to close at 2,893.76.
After the closing bell, shares of J.C. Penney Co Inc (JCP.N) slumped 11 percent to $29.66 following the retailer's release of quarterly results and same-store sales that fell short of Wall Street's expectations. The company also said it would discontinue its quarterly dividend of 20 cents per share.
JPMorgan Chase & Co (JPM.N) rose 1.3 percent to $36.24, mostly unchanged this week after falling more than 11 percent last week after disclosing a trading loss of at least $2 billion. Pressure mounted on the bank to reclaim some of the millions of dollars it paid to the executives who oversaw the wrong-way trades.
Avon Products Inc (AVP.N) tumbled 9.7 percent to $18.71 after Coty Inc COTY.UL withdrew its $10.7 billion takeover bid for the company, saying it had missed a deadline to start discussions.
Chesapeake Energy Corp (CHK.N) shares dropped as much as 7.8 percent to $14.31, their lowest since March 2009, after a credit rating downgrade and news that the natural gas producer will increase its borrowing to $4 billion from the planned $3 billion as it faces a liquidity crunch. Chesapeake shares finished the session down 5.6 percent at $14.65.
Facebook Inc increased the price range of its initial public offering, aiming to raise more than $12 billion and giving the world's largest social network a valuation potentially exceeding $100 billion.
The indications of high demand for Facebook's IPO prompted some buyers to snap up other social media companies' shares, such as online game maker Zynga Inc (ZNGA.O), up 7.7 percent at $8.56.
Volume was active with about 7.28 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, above the daily average of 6.78 billion.
Declining stocks outnumbered advancing ones on the NYSE by a ratio of nearly 2 to 1, while on the Nasdaq, about 14 stocks fell for every 11 that rose.
(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)
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