NEW YORK (Reuters) - The S&P 500 dropped more than 1 percent and posted its worst three-day slide since November 2011 on Monday following worries that global economic weakness will dampen U.S. earnings, along with concern about the spread of Ebola.
After trading nearly even for much of the session, stocks fell sharply late in the day and the S&P 500 closed below its 200-day moving average for the first time since Nov. 16, 2012. The CBOE Volatility index .VIX ended at 24.64, its highest close since June 2012.
Investors reacted to a witch’s brew of negative catalysts that included a widening Ebola scare, the potential impact on U.S. earnings from tepid global demand, plunging oil prices and a breakdown of technical support levels.
The day’s worst-performing sector was S&P energy .SPNY, which lost 2.9 percent. It is down 7.6 percent for the last three sessions, its worst three-day slide since September 2011. Shares of ConocoPhillips (COP.N) slid 3.3 percent to $68.07.
“There are worries about how corporate earnings are going to come out later on this week. The dollar has been on an uptrend and that’s going to hurt earnings for global companies,” said Giri Cherukuri, head trader at OakBrook Investments LLC, in Lisle, Illinois.
Airline and other travel-related stocks fell after a Dallas nurse contracted Ebola while caring for a dying Liberian patient.
The Dow Jones transportation average .DJT dropped 2.2 percent and is now down 11.1 percent from its record close on Sept. 18, which puts it in correction territory.
Five of the 10 S&P 500 sector indexes - industrials, energy, telecommunications, consumer discretionary and materials - ended in negative territory for the year.
The day’s drop followed the S&P and Nasdaq’s worst weekly percentage declines since May 2012 in concerns the market is in for further weakness and more jolts.
The Dow Jones industrial average .DJI fell 223.03 points, or 1.35 percent, to 16,321.07, the S&P 500 .SPX lost 31.39 points, or 1.65 percent, to 1,874.74 and the Nasdaq Composite .IXIC dropped 62.58 points, or 1.46 percent, to 4,213.66.
The S&P 500 has lost 4.8 percent in the last three sessions, its worst three-day decline since November 2011.
About 8.7 billion shares changed hands on U.S. exchanges, compared with the 7.9 billion average for the last five sessions, according to data from BATS Global Markets.
The largest percentage gainer on the S&P 500 was CSX Corp CSX.N, up 5.9 percent, while the largest percentage decliner was QEP Resources (QEP.N), down 9.2 percent.
Canadian Pacific Railway Ltd (CP.TO) has approached CSX about merging the two North American railroad operators to create a transcontinental carrier worth more than $60 billion, according to the Wall Street Journal.
Declining issues outnumbered advancing ones on the NYSE by 2,061 to 976, for a 2.11-to-1 ratio on the downside; on the Nasdaq, 1,525 issues fell and 1,156 advanced.
Editing by Nick Zieminski and Chris Reese