New York – Wall Street pared steep losses Monday to end narrowly mixed after a surprise drop in new-home sales for February triggered further concern that economic growth is slowing more than expected.
The Commerce Department reported that sales of new single-family homes fell by 3.9 percent last month to a seasonally adjusted annual rate of 848,000. It was the slowest sales pace in nearly seven years and dimmed hopes for a rebound in the troubled housing market.
Economists have been watching the housing industry for a hint about where the economy is heading.
The disappointing data came amid continued concern about the subprime mortgage market, which has been slammed by an increase in delinquencies in recent months.
This sent major indexes down throughout most of the session, with the Dow Jones industrials racking up triple-digit losses. Investors used the decline to buy some shares before the second quarter ends Friday, analysts said.
“The market is already worried more about economic growth than inflation, so I think you’re going to see reactions like this,” said Todd Salamone, director of trading at Schaeffer’s Investment Research in Cincinnati.
Oil prices settled Monday at their highest level this year on tensions between Iran and the West following Tehran’s detention of British naval personnel. Gasoline futures prices climbed above $2 a gallon to their highest level since September as a new driving season nears.
The Dow fell 11.94, or 0.10 percent, to 12,469.07. Last week, the benchmark index posted a 370-point gain, its best weekly point rise in four years. It dropped as much as 112 points earlier Monday.
The Standard & Poor’s 500 index rose 1.39, or 0.10 percent, to 1,437.50, and the Nasdaq composite index added 6.70, or 0.27 percent, to 2,455.63.
