(Updates to midday, changes byline)
By Ellis Mnyandu
NEW YORK, Dec 17 (Reuters) - U.S. stocks slid on Monday as
worries about the housing slump's impact on the economy rattled
investors, driving down shares of bellwethers such as
Caterpillar Inc <CAT.N>.
Technology shares also took a heavy beating as investors
worried about the outlook for business spending.
Concerns about the specter of rising inflation also put
investors on edge after last week's reports showed rising
prices pressures on the consumer front and at the wholesales
level.
The inflation data helped to sour expectations for more
rate cuts by the Federal Reserve, heightening fears of a
recession and dimming hopes for a year-end equity rally.
"There's such a total lack of good news to hold onto for
the balance of the year," said Peter Kenny, managing director
at Knight Equity Markets in Jersey City, New Jersey. "There's
more selling as a result of uncertainty."
The Dow Jones industrial average <.DJI> was down 68.69
points, or 0.51 percent, at 13,271.16. The Standard & Poor's
500 Index <.SPX> was down 7.08 points, or 0.48 percent, at
1,460.87. The Nasdaq Composite Index <.IXIC> was down 27.08
points, or 1.03 percent, at 2,608.68
Shares of Caterpillar, whose products include heavy
earth-moving equipment, were the top drag on Dow, falling 2.6
percent to $71.52 on the New York Stock Exchange.
Morgan Stanley cut its rating on Caterpillar to
"underweight" from "equal weight," according to
theflyonthewall.com, a financial Web site.
Shares of oil company Exxon Mobil Corp <XOM.N>, weighed on
the S&P 500 amid a drop in crude oil prices. Exxon shares lost
1.1 percent to $90.14 on the NYSE.
U.S. crude for January delivery <CLF8> dropped $1.42, or
1.6 percent, to $89.85 a barrel on the New York Mercantile
Exchange on concern that slower economic growth would sap
demand.
On the technology front, shares of International Business
Machines Corp <IBM.N>, the technology services company, were
the Dow's second-biggest drag behind Caterpillar.
IBM shares declined 1 percent to $104.74 on the NYSE.
On the Nasdaq, shares of iPod and iPhone maker Apple Inc
<AAPL.O>, led decliners, with a drop of 1.6 percent to
$187.42.
Shares of another tech bellwether, Research In Motion Ltd
<RIM.TO><RIMM.O> , the maker of BlackBerry devices, declined
3.5 percent at $102.25. The drag from such stocks will
contribute to the Nasdaq's third straight day of losses.
In economic news, a New York state manufacturing index fell
to a seven-month low. To add to slowdown jitters, diversified
manufacturer Illinois Tool Works <ITW.N> cut its fourth-quarter
earnings estimate, sendding its shares tumbling 4.7 percent to
$53.24 on the NYSE.
(Editing by Jan Paschal)
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Keywords: MARKETS STOCKS