US Stocks Sink Following Weak Services Sector Report

NEW YORK (AP) — U.S. stocks fell for a third straight day on Thursday after yet another disappointing report on the economy stoked fears of a slowdown.

The services sector, which makes up the bulk of the U.S. economy, grew at a slower pace in September than economists had forecast. The weak report follows disappointing figures on business hiring on Wednesday and a dismal manufacturing report on Tuesday.

The Dow Jones Industrial Average shed 143 points following the latest disappointing report. The grim start to October, which has knocked 3.6% off the Dow so far, more than erased all of the index’s gain from the previous month.

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The uncertainty about the economy mostly stems from the U.S.-China trade dispute. Investors now have to factor in a potential trade war between the U.S. and Europe after the U.S. imposed tariffs on European goods Wednesday after getting permission to do so from the World Trade Organization.

KEEPING SCORE: The S&P 500 index fell 0.4% as of 10:30 a.m. Eastern time. The Dow’s loss of 0.5% brought it to 25,939. The Nasdaq fell 0.4%.

SECTORS: Bank stocks also suffered losses as bond yields slumped. The yield on the 10-year Treasury fell to 1.52% from 1.59% late Wednesday. Real estate was the only sector to rise. That’s a safe-play, high-dividend sector that investors tend to favor when they’re feeling nervous.

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OVERSEAS: Stocks in Europe and Asia moved lower. Britain and the European Union remain divided on a potential deal covering their separation. Britain faces a chaotic exit from the trading bloc on Oct. 31 if it leaves without a deal covering trade and other issues. London’s FTSE 100 slumped 1.4%.

BUBBLY FORECAST: PepsiCo rose 2.8% after the company told investors it expects to meet or beat its target for revenue growth in 2019. The company set a goal of 4% growth in revenue from existing businesses. The solid forecast followed surprisingly good third quarter profit and revenue.

BUSTED GEAR: Tesla fell 4.2% after the electric car maker fell short of sales forecasts in the third quarter. The company delivered a record 97,000 vehicles, but still fell short of analysts’ forecasts for 99,000 vehicles. Tesla is also lagging behind the pace it needs to reach CEO Elon Musk’s sales goal for the entire year.

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LONG EXPOSURE: GoPro plunged 25% after the camera maker cut its profit and revenue forecasts for the year because of production delays. It is shifting shipments of its latest camera, the HERO8 Black, to the fourth quarter.


By AP reporter Damian J. Troise

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