Colorado stocks experienced their greatest percentage drop in nearly three years Tuesday, led by local consumer favorites Crocs and Chipotle and some relative unknowns.
The Bloomberg Colorado Index followed in the footsteps of the Dow Jones industrial average, dropping 3.2 percent. A sell-off in China and technical glitches weighed the Dow down by 416.02 points, or 3.3 percent, to close at 12,216.24.
The Bloomberg index, a price-weighted index of companies based in the state, dropped 12.87 to 395.42. That was the biggest daily percentage drop since June 28, 2004.
Niwot-based shoemaker Crocs Inc. fell almost 7 percent, or $3.50, to close at $48.48. Denver-based burrito maker Chipotle Mexican Grill Inc. closed down 5.3 percent, or $3.38, at $60.25. Both companies went public last year.
Of the 110 stocks in the index, 97 posted losses, compared with eight that advanced. Five stocks remained unchanged.
Smaller companies took some of the biggest hits Tuesday. Shares of Ascent Solar Technologies Inc., a Littleton-based company focused on solar energy, dropped 17.7 percent, or 87 cents, to close at $4.05. Lakewood-based VCG Holding, owner of adult-entertainment nightclubs, fell $1.62, or 15.5 percent, to $8.87.
It’s too soon to tell whether Tuesday’s tumble was a one-day aberration or indicative of an overall decline in the national and local economies, economists said.
University of Colorado economist Richard Wobbekind said that while the share losses wouldn’t have a major impact on individual companies, Tuesday’s drop could have a psychological impact on investors, leading to a “wealth effect.”
Investors presumably would feel less wealthy and cut back on durable goods and amenities such as shoes, which could lead to a slowdown in spending nationally and locally.
Another economist wasn’t so optimistic, signaling that the downturn in the housing market is hurting the overall economy.
“There’s been nothing but bad news. I think we may be in a period where more stocks are down than up,” said U.S. Bank economist Tucker Hart Adams. “The market has been at or near a record high for several months. I don’t think the underlying economy supports a continued rise.”
Some of the state’s largest companies by market value weathered Wall Street’s bumpy ride. Denver-based Newmont Mining fell 5.9 percent, followed by Greenwood Village’s First Data, dropping 4.4 percent, and EchoStar Communications, falling 3.7 percent. Qwest, the sixth-largest, fell just 2 percent.
Louisville biopharmaceutical company Replidyne was the big winner of the day, with shares rising nearly 6 percent to close up 31 cents at $5.49. The company went public last year.
Bloomberg News contributed to this report.
Staff writer Kimberly S. Johnson can be reached at 303-954-1088 or kjohnson@denverpost.com.
