* Worries on Iraq drive down Wall St stocks
* Biotech stocks rise despite overall downward trend
* U.S. Treasuries prices rise as stocks fall
(Updates with market close, adds comments)
By Barani Krishnan
NEW YORK, June 24 U.S. stocks ended lower on
Tuesday as worries about Iraq drove profit-taking, after
encouraging economic data earlier drove shares to another record
high, while sterling tumbled on doubts whether the Bank of
England would allow an interest rate hike soon.
U.S. Treasuries prices gained as investors turned away from
equities. Flagging business morale in Germany pulled European
stocks lower, though the dollar got a lift from the U.S.
The S&P 500 closed down more than half a percent for its
sharpest loss since June 12, after setting a fourth record high
in five sessions.
The stock market was boosted earlier by data showing
stronger-than-expected U.S. consumer confidence and an 18.6
percent surge in sales of new homes in May.
But shares reversed course and fell more sharply toward the
close on concerns about an escalation in the Iraq conflict. U.S.
Secretary of State John Kerry urged leaders of Iraq's autonomous
Kurdish region to stand with Baghdad in the face of a Sunni
insurgent onslaught that could destroy Iraq.
"The Iraq thing is probably getting more focus than anything
else," said Stephen Massocca, managing director at Wedbush
Equity Management LLC in San Francisco. "You really had the
market go up in almost a straight line since June 12, so at the
top of the range here, I'm not surprised to see a little bit of
The Dow Jones industrial average fell 119.13 points,
or 0.7 percent, to 16,818.13, the S&P 500 lost 12.63
points, or 0.64 percent, to 1,949.98, and the Nasdaq Composite
dropped 18.321 points, or 0.42 percent, to 4,350.355.
Biotech shares helped buoy the Nasdaq, led by a 40.4 percent
gain in Vertex Pharmaceuticals Inc to $93.53 in heavy
Vertex said a combination of drugs designed to treat cystic
fibrosis succeeded in improving lung function in a pair of
closely watched late-stage clinical trials.
The Nasdaq Biotech index climbed 1 percent.
The price of U.S. Treasury bonds rose, pushing the 10-year
benchmark yield down almost 2 basis points to 2.60 percent
The FTSEurofirst 300 index of leading shares
settled down 0.1 percent, after Germany's Ifo index of business
sentiment eased more than expected in June to its lowest level
this year. The MSCI world stocks indicator
was down 0.4 percent.
Sterling fell below $1.70, retreating from recent five-year
peaks after Bank of England Governor Mark Carney said there was
little wage or inflationary pressure in Britain.
The euro was little changed at $1.3603. The dollar
index was nearly flat, too, at 80.32.
In commodities, gold hit a more than two-month high
at $1,325.90 an ounce.
Brent crude settled up 34 cents at $114.46 a barrel,
supported by the fighting in Iraq. U.S. crude fell 14
cents to $106.03.
(Additional reporting by Jamie McGeever in London; Editing by
Dan Grebler, Bernadette Baum and Leslie Adler)