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Jobs, Intel reports punish stocks
The tech giant's second warning about poor conditions coincided with reports of wider job losses in December.
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NEW YORK - A warning Wednesday from technology giant Intel about poor business conditions, along with more evidence of rising joblessness left stocks with their biggest losses in a month.
The news upended some investors' hopes for a speedy economic recovery this year, and sent the major indexes down more than 2.5 percent, including the Dow Jones industrials, which lost 245 points.
Intel's second warning since November, as well as bleak outlooks from aluminum producer Alcoa and media industry bellwether Time Warner, underscored the breadth of the economy's slowdown. Also, the ADP National Employment Report said private-sector jobs fell by a greater-than-expected 693,000 in December. That made investors nervous ahead of Friday's employment report from the government.
But unlike the panicked declines of last fall, Wednesday's pullback was more orderly, and stocks finished off their lowest levels of the session. Some retrenchment had been expected after sharp gains in recent sessions and a 24.2 percent rally in the Standard & Poor's 500 index since Nov. 20 before Wednesday's slide.
Wall Street has been absorbing poor economic and corporate news far better since late November, with some investors betting on a recovery in the second half of this year or by early 2010. But the latest round of bad news proved to be too much to set aside.
Wall Street was already worried about what the Labor Department's report on employment would bring Friday. The government report is typically the most important economic reading each month, because rising unemployment could endanger consumer spending.
The concerns sent the Dow down 245.40, or 2.72 percent, to 8,769.70, its biggest point and percentage decline since Dec. 1. Broader stock indicators also tumbled. The Standard & Poor's 500 index fell 28.05, or 3 percent, to 906.65. It was the biggest drop for the index since Dec. 1.
And the Nasdaq composite index was off 53.32, or 3.23 percent, to 1,599.06, hurt by the decline in Intel shares.
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