Stocks fall on weaker home sales
by Daniel Wagner, AP Business Writer
September 26, 2012 10:02 PM | 469 views | 0 0 comments | 5 5 recommendations | email to a friend | print
A mixed report about the housing market and unrest in Europe on Wednesday extended the longest losing streak for the Standard & Poor’s 500 index since mid-July. Other risky assets, like European stocks and oil, fell more sharply.

The median price of new homes sold in August rose by a record amount, while sales of new homes dipped slightly. Sales in August were up 27.7 percent from a year earlier, but remain at about half the pace economists consider healthy.

The dip in home sales hurt homebuilder stocks. PulteGroup Inc. fell 76 cents, or 4.7 percent, to $15.30; KB Home 51 cents, or 3.5 percent, to $13.90 and Beazer Homes USA Inc. 14 cents, or 3.9 percent, to $3.50.

Rising demand for lower-risk investments fed strong bids for U.S. Treasury debt. The yield on the 10-year Treasury note fell to 1.62 percent from 1.67 percent late Tuesday. A bond’s yield falls as its price increases.

The Dow Jones industrial average fell 44.04 points, or 0.3 percent, to 13,413.51. The S&P 500 index fell 8.27, or 0.6 percent, to 1,433.32. The only category that rose was utilities, relatively safe stocks that tend to hold their value when the economy is weak.

The Nasdaq composite average fell 24.03 points, or 0.8 percent, to 3,093.70.

The declines came a day after the worst sell-off for the S&P 500 in three months. Charles Plosser, president of the Fed’s Philadelphia branch, told an audience Tuesday that the Fed’s effort to support the economy would likely fall short of its goals.

Stocks rallied this month on bold moves by central bankers. They had one of their biggest gains of the year Sept. 6 after Mario Draghi, the president of the European Central Bank, said the ECB would buy unlimited amounts of government bonds to lower borrowing costs for Europe’s debt-burdened countries.
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