NEW YORK — Stocks dropped for a second day Tuesday after home sales fell unexpectedly and the White House said it would fight a court ruling that lifted its ban on offshore oil drilling.
The Dow Jones industrial average fell 149 points, its biggest drop in about two weeks. Treasury prices climbed after demand for safe investments rose.
The National Association of Realtors reported that home resales fell 2.2 percent in May. The report surprised analysts who thought sales would get a lift from a homebuyer tax credit. Sales fell to a seasonally adjusted annual rate of 5.66 million from a revised 5.79 million in April.
Homebuilder Toll Brothers slid 3.2 percent, while Hovnanian Enterprises fell 3.5 percent.
Oil stocks fell after the administration said it would appeal a judge’s decision to overturn a six-month ban on deep-water oil drilling in the Gulf of Mexico. Baker Hughes, a supplier of oil-drilling parts and services, fell 4.4 percent, while oil-services company Halliburton fell 3.9 percent.
It was the second straight day that the market gave up early gains to end lower. The selling intensified shortly before 2 p.m. EDT, when the benchmark Standard & Poor’s 500 index fell below 1,111, its average finish of the past 200 days. Many professionals who use technical factors in their buying and selling decisions consider the 200-day moving average, as it’s called, to be a predictor of the market’s direction. The drop below 1,111 hastened the market’s slide because computer programs kicked in and drove more selling.
The Dow fell 148.89, or 1.4 percent, to 10,293.52, its biggest point and percentage loss since June 4. It was up as much as 51 points in morning trading. The Standard & Poor’s 500 fell 17.89, or 1.6 percent, to 1,095.31, while the Nasdaq composite fell 27.29, or 1.2 percent, to 2,261.80.
The Dow crossed the unchanged mark 74 times.
Peter Tuz, president of Chase Investment Council in Charlottesville, Va., said trading likely will be choppy until July, when companies start to report quarterly earnings.
