By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market ended Monday's
volatile session sharply lower as selling intensified at the last
hour.
Volatile trading came on the heels of last week's deep losses
that had been triggered by global economic growth concerns.
Monday's trading marked the fifth consecutive day of 1% moves
for the S&P 500 and triple-digit moves for the Dow Jones
Industrial Average.
Key technical levels were in focus, especially as there was no
data on the economic calendar and bond markets were closed for
Columbus Day holiday.
The S&P 500 (SPX) closed down 31.39 points, or 1.6%, to
1,874.74. The benchmark index has pulled back more than 6% from its
peak reached on Sept. 18.
All of the main benchmarks are trading below their 200-day
moving averages. Falling below the 200-day moving average level,
and in the case of the S&P 500, below the 1,900 level, is
considered significant as many analysts see the breach as a sign of
further declines. Vote here: Does this stock slump have further to
go?
The Dow Jones Industrial Average (DJI) dropped 223 points, or
1.3%, to 16,321.07. The blue-chip index turned negative for the
year on Friday and is now down 1.5% year-to-date.
The Nasdaq Composite (RIXF) dropped 62.58 points, or 1.5%, to
4,213.66. The Russell 2000 (RUT) gave up solid gains of early
morning and closed down 4.3 points, or 0.4%, at 1,049.17.
Karyn Cavanaugh, senior market strategist with Voya Investment
Management, is not surprised by increased volatility.
"Normal markets are volatile and the 6% pullback on the S&P
500 seems like a big drop while in the middle of it, but it's not,"
Cavanaugh said.
Cavanaugh pointed out that companies that were profitable two
months ago may see their share prices run up again after earnings
are released soon. She argues that volatility only made stocks
cheaper and more attractive.
On Tuesday, earnings season will get under way in earnest with
major banks such as J.P. Morgan Chase & Co.(JPM) and Citigroup
Inc. (C) among those due to report.
Stocks to watch:
CSX Corp. (CSX) jumped 5.9%. Citing sources, The Wall Street
Journal reported that Canadian Pacific Railway Ltd. (CP) approached
CSX about a tie-up. CSX rebuffed the overture, made in the past
week, those sources said. It's unclear if Canadian Pacific will
pursue it.
Shares of Tekmira Pharmaceuticals Corp. (TKMR) , one of the
pharmaceutical companies whose drug TKM-Ebola has been used in the
fight against the deadly virus, was up 3.9%.
Hazmat-suit maker Lakeland Industries Inc. (LAKE) surged 48%
after a 126% jump last week on fears related to the Ebola virus. In
addition, shares of face-mask maker Alpha Pro Tech (APT) soared
35%. Also read: Ebola stock trading volumes should raise red
flags
J.C. Penney Co. (JCP) shares jumped as much as 6% before the
bell, but pared those gains and closed 0.4% lower. The retailer on
Monday said Home Depot executive Marvin Ellison will take over as a
chief executive next year, succeeding current CEO Myron Ullman. The
move comes days after J.C. Penney cut its sales forecast for the
current quarter. Read about more notable stock moves in Movers and
Shakers
Other markets: European stocks ended mostly flat, while Hong
Kong stocks ( closed higher after strong Chinese trade data.
Gold (GCZ4) futures rose 1%, while crude oil (CLX4) slid.
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