Weak retail sales, worries about China sink stocks

NEW YORK ?

Stocks fell in early trading on Wall Street Thursday on worrisome signs that Americans are spending at a slower pace and that China's economy is in worse shape than previously thought.

American shoppers pulled back on spending in June, resulting in tepid sales for many retailers. Target fell 1 percent after reporting that its sales rose less than analysts were expecting. Fred's Inc. fell 4 percent.

The reports raise concerns about Americans' ability to spend during the back-to-school shopping season, which starts later this month. The weakness came against of backdrop of more weakness in the global economy.

The Dow Jones industrial average fell 70 points to 12,873 in the first hour of trading. The Standard & Poor's 500 index fell eight points to 1,365 and the Nasdaq composite index gave up 11 points to 2,964.

All 10 industrial sectors fell in the S&P 500, led by bank stocks. JPMorgan Chase fell $1.5, or 4 percent, to $34.54, while Bank of America fell 19 cents, or 2.4 percent, to $7.87.

China surprised investors with its second rate cut in a month, leading investors to worry that the downturn in the world's second-largest economy may be bigger than previously expected.

The People's Bank of China cut its main lending rate 0.31 percentage point to 6 percent and reduced its deposit rates by a quarter of a percentage point to 3 percent. The bank said the cuts are intended to boost economic growth in the second half of the year. Analysts said the cuts are also a sign that Chinese authorities are increasingly concerned about that country's economy.

Central banks in Europe were also moving to stem a slowdown there. The Bank of England approved a 50 billion pound injection into the ailing British economy, while the European Central Bank cut its main interest rate by a quarter of a percentage point to 0.75 percent, the lowest it's been since the bank was established in 1999.

In the U.S., several large retailers reported poor sales for June, while others beat analysts' expectations.

- Ross Stores rose $3.32, or over 5 percent, to $66.11 after the discount store operator said sales at stores open at least a year rose 7 percent in June, easily beating Wall Street predictions.

- TJX Cos., which operates T.J. Maxx, Marshalls and Home Goods stores, also reported a wider-than-expected 7 percent increase in sales last month. Its stock rose $1.48, or 3.5 percent, to $43.97.

Source: http://feeds.seattletimes.com/click.phdo?i=f22633c9d5f80e25b93e41fb6aa18d7d

gainesville 2012 royal rumble the grey machine gun kelly saul alinsky annapolis trisomy