* Nasdaq falls under 100-day moving average
* Biotech indexes have worst day since August 2011
* Bed, Bath & Beyond slumps after earnings
* Indexes off: Dow 1.2 pct, S&P 1.6 pct, Nasdaq 2.7 pct
(Updates to afternoon trading)
By Ryan Vlastelica
NEW YORK, April 10 U.S. stocks sank on Thursday,
with the S&P 500 turning negative for the year and the Nasdaq
falling its most in a day since June 2012 as investors again
sold high-flying names in the technology and biotech sectors and
sought shelter in defensive names.
The Nasdaq's decline took it below its 14-day and 100-day
moving average, a sign of weakening short-term momentum.
More than 80 percent of Nasdaq-listed shares fell and the
index's drop was more than twice the percentage decline in the
blue-chip Dow index. About 69 percent of stocks fell on the New
York Stock Exchange.
The move was a sharp reversal from the previous day, when
shares rallied after minutes from the latest Federal Reserve
policymakers' meeting showed members were more keen to keep
rates low than earlier expected.
The day's decline more than wiped out Wednesday's advance as
so-called "momentum" names suffered their worst day since a
recent pullback in the names began in March. The CBOE Volatility
index, a measure of investor anxiety, spiked 12.3 percent
to 15.51, though it remains at historically low levels.
"The rotation is out of some of the higher-growth,
higher-momentum areas of the market, and until we get earnings
visibility, we could see protracted weakness," said Eric Teal,
chief investment officer at First Citizens Bancshares Inc in
Raleigh, North Carolina, which manages $3.5 billion.
The Nasdaq biotechnology index shed 5.7 percent, its
biggest one-day drop since August 2011. Alexion Pharma
was the biggest decliner among S&P 500 components, off 8 percent
at $143.19, followed by Gilead Sciences, off 7.1
percent at $65.63.
Internet-related tech shares, which were among last year's
biggest advancers, also dropped. Facebook Inc fell 5
percent to $59.28 while Netflix Inc sank 4.3 percent to
$337.94. Google Inc was down 2.8 percent at $548.62.
The S&P technology sector shed 2 percent as one of the
worst-performing S&P sectors.
Losses were broad, with nine of the S&P 500's 10 primary
sectors lower on the day.
The only group to rise was telecom, considered a
defensive play, which inched up 0.3 percent. AT&T Inc rose
1.1 percent to $35.29.
The Dow Jones industrial average was down 196.51
points, or 1.20 percent, at 16,240.67. The Standard & Poor's 500
Index was down 29.81 points, or 1.59 percent, at
1,842.37. The Nasdaq Composite Index was down 112.95
points, or 2.70 percent, at 4,070.95.
Bed, Bath & Beyond shares slumped 6.1 percent to
$63.78 after the home-goods retailer reported fourth-quarter
sales that fell from a year ago and gave a first-quarter outlook
that was below expectations.
The lackluster earnings overshadowed optimistic data on the
labor front. Initial jobless claims dropped sharply last
week to the lowest in almost seven years, which suggests job
growth may be picking up after a harsh winter.
Reception for three initial public offerings was negative.
Shares of bailed out auto-lender Ally Financial Inc
fell in its market debut, the biggest U.S. initial public
offering so far this year. The stock lost 4 percent to $23.99.
Two biotech companies - Cerulean Pharma Inc and
Adamas Pharmaceuticals Inc - also declined in their
trading debuts. Cerulean fell 3.1 percent to $6.78 while Adamas
lost 4.4 percent to $15.30.
Imperva Inc plunged 41.9 percent to $28.91 after
the data center security company reported preliminary
fist-quarter results. Rival FireEye Inc lost 8.2
percent to $51.76.
(Additional reporting by Chuck Mikolajczak; Editing by