Global slowdown continues

November 9, 2015 09:50 AM

U.S. stocks were lower on Monday morning after weak Chinese trade data and an OECD report warning of a global slowdown spurred concerns about weakening demand.

Data showed China's October exports fell for a fourth month, while imports also dropped, leaving the world's second largest economy with a record high trade surplus of $61.64 billion. The U.S. is one of China's biggest trade partners.

The Organisation for Economic Co-operation and Development cut its 2015 global growth forecast again, but said the U.S. Federal Reserve should raise interest rates as the U.S. economic recovery gains steam.

All the 10 major S&P sectors were lower. Priceline was the biggest drag on the S&P 500 and the Nasdaq, falling 6 % after a weak fourth-quarter profit forecast.

U.S. stocks have largely brushed off concerns about the global economy and have ended higher for six weeks in a row, buoyed by better-than-expected corporate results and signs of a strengthening domestic economy.

The stronger-than-expected U.S. jobs report on Friday spurred traders to raise odds that the Fed would raise rates off near-zero levels next month.

The market would likely consolidate around current levels after Friday's report, said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

At 9:33 a.m. ET, the Dow Jones industrial average was down 87.12 points, or 0.49 %, at 17,823.21.

The S&P 500 was down 9.32 points, or 0.44 %, at 2,089.88 and the Nasdaq Composite index was down 25.16 points, or 0.49 %, at 5,121.96.

An increase in interest rates raises borrowing costs for companies, but is good for banks and other financial companies.

But even the financial index was lower on Monday. The telecom sector's 0.94 % fall led the S&P sector decliners, while the rate-sensitive utilities sector's 0.05 % fall was the least.

Priceline fell 6 % to $1365.84 after the travel websites operator forecast weak fourth-quarter profit. Rival Expedia also fell 1.4 % to $131.55.

Dean Foods rose 7 % to $19.17 after reporting better-than-expected quarterly profit.

Apache jumped 11.6 % to $53.23 after Bloomberg reported the oil and gas company had rejected a takeover approach from an unidentified party.

Plum Creek Timber soared 15.4 % to $46.50 after Weyerhaeuser said it would buy the company to create a $23 billion timber, land and forest products company. Weyerhaeuser was down 2.9 % at $29.52.

Declining issues outnumbered advancing ones on the NYSE by 1,959 to 695. On the Nasdaq, 1,434 issues fell and 777 advanced.

The S&P 500 index showed one new 52-week high and no new lows, while the Nasdaq recorded 41 new highs and nine new lows.

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Abhiram Nandakumar, Reuters