New York – Wall Street had its worst day in more than four months Monday as the dollar weakened and concerns about the strength of the retail industry arose following a rare sales decline at Wal-Mart Stores Inc. The Dow Jones industrials fell 158 points.
Investors were uneasy after the dollar fell for the fifth straight day and after Wal- Mart, the world’s largest retailer, reported a 0.1 percent drop in same-store sales, those from stores open at least a year. Same-store sales are the industry standard for assessing a retailer’s strength, and while overall retail sales appeared strong last weekend, Wal-Mart’s first deficit in a decade raised concerns about the strength of consumer spending during the holiday season.
“There is now significant concern that the holiday retail season is going to underperform,” said Gregory Miller, chief economist at SunTrust Banks. “(In-store) traffic doesn’t necessarily translate into profits.”
As the dollar’s slide continued, it hit a 20-month low against the euro, although it did for a time move higher against the Japanese yen. The dollar’s fall raised concerns that foreign investors were sensing weakness in the U.S. economy and would pull some of their investments from U.S. markets.
Beyond the weak dollar and news from Wal-Mart, some retrenchment was to be expected as investors seek to preserve their profits after stocks have soared the past two months.
The Dow fell 158.46, or 1.29 percent, to 12,121.71, as 27 of the index’s 30 blue chip stocks fell. It was the Dow’s biggest slide since a string of triple-digit declines in mid-July that followed disappointing profit reports and a spike in oil prices amid tensions with Iran and North Korea.
Broader stock indicators also dropped sharply Monday. The Standard & Poor’s 500 index fell 19.05, or 1.36 percent, to 1,381.90, and the Nasdaq composite index slid 54.34, or 2.21 percent, to 2,405.92.
