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Aug 10, 2012, 10.50 PM IST
MARKETS-USA-STOCKS:U.S. stocks slip on Chinese data, S&P still up for week
By Anna Louie Sussman
NEW YORK (Reuters) - U.S. stocks fell on Friday on far weaker-than-expected growth in Chinese exports in a sign of a slowing global economy, but the S&P 500 was on track for a fifth straight week of gains.
Data on Chinese trade and bank lending suggested pro-growth policies have been insufficient and more urgent government action may be needed to stabilize the economy.
"The data from China is concerning because the global economy is still the backdrop for the market. People are still very cautious because of the global growth concerns," said Paul Brigandi, vice president of trading at Direxion Funds in New York.
The S&P 500, which closed Thursday at a three-month high, fluctuated around 1,400 as the momentum of the recent rally has stalled. Investor sentiment had been buoyed by expectations that central banks would loosen monetary policy further.
The European Central Bank is expected to act soon to lower punishing borrowing costs for Spain and Italy as a way to stabilize the euro zone's economy.
"After these numbers investors may want to see activity fairly quickly, especially from the ECB," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont, referring to the Chinese data.
The drop in Chinese exports included a 16 percent decline in shipments to Europe from a year ago.
The Dow Jones industrial average was down 12.90 points, or 0.10 percent, at 13,152.29. The Standard & Poor's 500 Index was down 1.68 points, or 0.12 percent, at 1,401.12. The Nasdaq Composite Index was down 5.58 points, or 0.18 percent, at 3,013.06.
Cyclical stock sectors, including financials, energy and consumer discretionary, fell.
The expectation of central bank action, however, may give support to equities as investors think twice about shorting the market on the possibility of any action.
Some economists said China's central bank could move as early as this weekend to ease policy. It has reduced banks' required reserve ratio in three steps since November to free up new lending and cut interest rates in June and July.
Research In Motion's U.S.-traded shares
(Reporting by Anna Louie Sussman and Rodrigo Campos; Editing by Kenneth Barry)
May 23 2013, 16:33
- in Asian markets
May 23 2013, 09:33
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