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US and European market indices drop

04 June 2009 08:11 (UTC +04:00)

Baku- APA-Economics. he problem with rising expectations is they get tougher to beat.
Investors broke the stock market’s four-day rally and sold off after data on the services industry and factory orders came in below forecasts. Factory orders actually rose in April, but the report disappointed investors who anticipated a larger increase.
The Dow Jones industrial average fell almost 66 points, or 0.8 percent, while the Standard & Poor’s 500 index fell 1.4 percent. The Nasdaq composite index, which has been outperforming the other indicators this year, fell just 0.6 percent.
Optimism about the economy stabilizing has lifted the Dow 32.5 percent from its 12-year low reached in early March. Over those three months, topping investors’ expectations meant clearing a relatively low bar.
The Dow fell 65.63, or 0.8 percent, to 8,675.24. The Standard & Poor’s 500 index fell 12.98, or 1.4 percent, to 931.76. The Nasdaq composite index fell 10.88, or 0.6 percent, to 1,825.92.
The S&P 500 index and Nasdaq pulled back from their highest levels so far this year, reached Tuesday. Both the S&P and Nasdaq are still up for the year, but the Dow has yet to break back into positive territory for 2009. It got within 35 points, or 0.4 percent, of that break-even point on Tuesday.
The yield on the benchmark 10-year Treasury note, which moves opposite its price, slipped to 3.54 percent from 3.62 percent. Last week, the 10-year yield surged to a six-month high of 3.75 percent.
The dollar gained ground against the euro and the British pound, while gold prices sank.
The Russell 2000 index of smaller companies fell 3.92, or 0.7 percent, to 522.71.
Overseas, Japan’s Nikkei stock average added 0.4 percent, Britain’s FTSE 100 fell 2.1 percent, Germany’s DAX index fell 1.7 percent, and France’s CAC-40 fell 2.0 percent. Source: AP