| NEW YORK, Sept 4
NEW YORK, Sept 4 Mid- and smallcap stocks were
lower Tuesday after economic data pointed to an economy that
remained sluggish and pulled economically sensitive sectors
The Institute for Supply Management said its index of
national factory activity fell to 49.6 in August from 49.8 in
July and below the 50.0 median estimate in a Reuters poll of
economists. A reading below 50 indicates contraction.
Separately, construction spending in July dropped 0.9
percent to an annual rate of $834.4 billion, the lowest level
since April. Reuters estimate called for a gain of 0.4 percent.
With a key payrolls report looming on Friday, the data
provided little help for investors looking for insight into
possible moves by the U.S. central bank to stimulate the economy
when it meets on Sept. 12-13.
"The problem as much as anything is just the uncertainty out
there," said Edward Hemmelgarn, chief investment officer at
Shaker Investments in Cleveland.
"The ISM manufacturing wasn't great, it wasn't disastrous,
it's not very far off from what people had forecast -
(investors) are just scratching their heads trying to figure out
what happens next."
The S&P MidCap 400 index shed 0.3 percent while the
S&P SmallCap 600 index lost 0.4 percent. In comparison,
the benchmark S&P 500 fell 0.5 percent.
Sectors closely tied to economic fortunes were among the
worst performers, with energy and materials
falling more than 1 percent for both mid- and
Midcap Arch Coal Inc dropped 6.9 percent to $5.69
after Dahlman Rose cuts its price target on the stock to $9 from
$12. Smallcap Monolithic Power Systems Inc slumped 7.8
percent to $19.88 after Piper Jaffray cut the stock to a
But Medicis Pharmaceuticals Inc surged 38.1 percent
to $43.57 after the company agreed to be acquired by Valeant
Pharmaceuticals International Inc for $2.6
billion in cash.