| NEW YORK, April 9
NEW YORK, April 9 Mid- and smallcap stocks
dropped over one percent o n Monday after weaker-than-expected
payrolls data fueled a pullback in riskier assets which had
rallied throughout the year.
Government data on Friday showed employers added 120,000
jobs in March, the smallest increase since October and well
short of the 203,000 jobs expected by Wall Street.
Both the S&P MidCap 400 index and SmallCap 600 index had
climbed more than 30 percent from their October lows, largely on
the strength of improving domestic economic data.
"You are seeing somewhat of a correction which is a bit
natural until we start getting data - meaning earnings," said
Edward Hemmelgarn, chief investment officer of Shaker
Investments in Cleveland.
"We'll have to see how that translates, there is not a whole
lot you can do until you start getting earnings and companies
start talking about how they are doing, so it's kind of a
waiting game here and it's perfectly natural."
Selling was broad, with each of the 10 major sectors among
both mid- and smallcaps in negative territory. The midcap index
was on track for its biggest decline since March 6 and the
smallcap index was on track for its worst drop of the year.
The S&P MidCap 400 index lost 1.7 percent. The S&P
SmallCap 600 index fell 2.1 percent. In comparison, the
benchmark S&P 500 declined 1.3 percent.
Healthcare stocks tumbled, weighed down by a drop in
smallcaps Molina Healthcare Inc and Centene Corp
, after the companies were not among the five plans
selected by the state of Ohio to serve its Medicaid healthcare
program for the poor.
Molina shares plunged 24.7 percent to $26.38. Centene
slumped 13.2 percent to $44.10. Midcap Amerigroup
dropped 5.5 percent to $63.71.
"If it is a sign what you are seeing is just a much more
aggressive move on the part of the bigger healthcare firms then
that is much tougher for these (smaller) guys because they don't
have the big corporate contracts to fall back on," said
Midcap AOL Inc was one of the few bright spots,
surging 45.8 percent to $26.85 after the company said it would
more than 800 patents to Microsoft Corp MSFT.O for just over $1