U.S. stocks had the steepest weekly loss since July after unemployment increased to a two-year high and manufacturing declined, bolstering speculation that a recession will stymie profit growth.
Intel Corp. tumbled the most since January 2006, leading semiconductor shares in the Standard & Poor’s 500 Index to the biggest drop in 5 1/2 years. D.R. Horton Inc., Centex Corp., Hovnanian Enterprises Inc. and other homebuilders staged the biggest slump since the September 2001 terrorist attacks. Citigroup Inc., Fannie Mae and National City Corp. drove the S&P 500 Financials Index to the lowest in 38 months.
The S&P 500 retreated 4.5 percent to 1,411.63 this week, the steepest fall in five months. The Dow Jones Industrial Average slumped 4.2 percent to 12,800.18. That brought its loss since Dec. 31 to 3.5 percent, the worst first three days of any year since 1904, according to Bloomberg data. The Nasdaq Composite Index declined 6.4 percent to 2,504.65, the lowest since April.
Smaller companies fell more. The Russell 2000 Index, whose members have a median market value of $541 million, lost 6.5 percent to 721.6. [MORE]
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