Wall Street drops on Russia worry as techs, materials drag

NEW YORK Wed Mar 26, 2014 7:32pm EDT

1 of 2. Traders work during the IPO of Mobile game maker King Digital Entertainment Plc on the floor of the New York Stock Exchange March 26, 2014.

Credit: Reuters/Brendan McDermid

NEW YORK (Reuters) - U.S. stocks fell on Wednesday, led by losses in the technology and materials sectors, as geopolitical concerns rose after the United States and the European Union agreed to work together on tougher sanctions on Russia.

Trading remained choppy with U.S. stocks mostly positive in the morning after U.S. economic data pointed to improving conditions. But the major indexes reversed course in the afternoon as technology stocks turned sharply lower.

Among technology stocks, Facebook (FB.O) was one of the biggest decliners a day after the social networking company said it would acquire two-year-old Oculus VR Inc, a maker of virtual-reality glasses for gaming, for $2 billion. Facebook shares ended down 6.9 percent at $60.39.

The United States and the European Union agreed to work together to prepare possible tougher economic sanctions in response to Russia's behavior in Ukraine. The sanctions could possibly include the energy sector.

The S&P energy sector index .SPNY slipped 0.3 percent.

U.S. President Barack Obama said after a summit with top EU officials that Russian President Vladimir Putin had miscalculated if he thought he could divide the West or count on its indifference over his annexation of Crimea.

"This could be a non-event if the market wasn't at the level that it is now. Because we are still near a record high, this kind of geopolitical news can make investors more nervous," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

A sharp drop in the stock of King Digital Entertainment Plc (KING.N), the maker of the wildly popular "Candy Crush Saga" game, also soured investor sentiment.

King's stock fell 15.6 percent to close at $19 in its trading debut on Wednesday after the initial public offering valued the company at about $6 billion. King was the most actively traded stock on the New York Stock Exchange.

The Dow Jones industrial average .DJI slipped 98.89 points, or 0.60 percent, to end at 16,268.99. The Standard & Poor's 500 Index .SPX dropped 13.06 points, or 0.70 percent, to finish at 1,852.56. The Nasdaq Composite Index .IXIC fell 60.69 points, or 1.43 percent, to close at 4,173.58.

The CBOE Volatility Index .VIX, a widely used gauge of investor sentiment on Wall Street, rose 6.5 percent to end at 14.93. The VIX usually moves inversely to the S&P 500.

Biotech stocks, which have sold off sharply in recent sessions, extended their losses. The Nasdaq biotechnology index .NBI slid 1.9 percent to end at 2,455.84.

The S&P materials sector index .SPLRCM tumbled 1.4 percent and ranked as the biggest decliner among 10 S&P sector indexes.

Among materials stocks, Newmont Mining Corp (NEM.N) shares fell 3.6 percent to end at $23.07 and ranked as the biggest decliner in the S&P materials sector index. Dow Chemical Co (DOW.N) shares dropped 2.4 percent to close at $49.43.

The S&P 500's only positive sector was healthcare .SPXHC, up just 0.1 percent for the day.

Going against the day's downward trend, DirectTV shares (DTV.O) shot up 5.7 percent to end at $77.34 and Dish Network Corp (DISH.O) shares jumped 6.3 percent to close at $62.09. Dish Chief Executive Officer Charlie Ergen recently contacted DirecTV CEO Mike White to discuss a possible tie-up, Bloomberg reported, citing sources familiar with the matter.

After the bell, the U.S. Federal Reserve objected to plans by Citigroup (C.N) and four other banks to return capital to shareholders, saying it had uncovered deficiencies during an annual test of their financial robustness.

Citigroup shares fell more than 5 percent in extended-hours trading following the news. The shares had ended the regular session at $50.16, down 0.3 percent.

In the latest look at the U.S. economy, orders for durable goods rose more than expected in February, ending two straight months of declines. Another report showed private-sector economic activity accelerated in March at a faster clip than in February as the services sector picked up, according to financial data firm Markit's preliminary composite Purchasing Managers Index.

Volume of about 7.1 billion shares traded on U.S. exchanges, slightly above the 6.9 billion average so far this month, according to data from BATS Global Markets.

Decliners beat advancers by a ratio of 2 to 1 on the New York Stock Exchange, while on the Nasdaq, nearly four stocks fell for every one that rose.

(Editing by Jan Paschal)

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Comments (4)
111Dave111 wrote:
Home Prices UP!
Consumer Confidence UP!
Wholesale Goods Orders UP!

Yet Conservatives/Republicans/Tea/Libertarians (indecisive, no?), can’t believe in FACTS!

Republicans/Tea/Libertarians/Conservatives/etc can’t believe in FACTS like
Health Insurance is good for Working Americans.
Pollution is bad for Americans.
Government Deficits are in the Republican (etc) Recessionary Past.

Mar 26, 2014 11:31am EDT  --  Report as abuse
111Dave111 wrote:
Home Prices UP!
Consumer Confidence UP!
Wholesale Goods Orders UP!

Yet Conservatives/Republicans/Tea/Libertarians (indecisive, no?), can’t believe in FACTS!

Republicans/Tea/Libertarians/Conservatives/etc can’t believe in FACTS like
Health Insurance is good for Working Americans.
Pollution is bad for Americans.
Government Deficits are in the Republican (etc) Recessionary Past.

Mar 26, 2014 11:31am EDT  --  Report as abuse
rvm3 wrote:
You are pathological lairs, Reuters. You updated this article at 2:18PM when the market was solidly down. Dear God.

Mar 26, 2014 2:37pm EDT  --  Report as abuse
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