Dow extends losses to fourth day on worrisome housing data

07:55, August 25, 2010      

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U.S. stocks extended losses on Tuesday, with the Dow Jones industrial average falling for the fourth straight day, as concerns over economic slowdown intensified after worrisome housing data.

Major indexes followed world markets lower when U.S. market opened on Tuesday. Japan's Nikkei 225 Stock Average entered a bear market as the Japanese Yen rocketed to a 15-year high against the dollar, putting pressures on its high-tech export-oriented economy.

The market added losses after a latest report on existing home sales rattled investors, once again raising concerns over a double dip in the battered housing sector.

According to the National Association of Realtors, sales of previously owned U.S. homes plunged a record 27.2 percent in July from a month earlier to an annual rate of 3.83 million units, the lowest level in 15 years.

U.S. home sales picked up before the expiration of a government tax credit program, but showed signs of souring afterwards. Pending home sales plunged 30 percent in May and mortgage application volumes dived by double digits even as interest rates hovered near their lowest levels in generations.

Some economists have been warning the risk of a double dip in the housing market and apparently such concerns intensified on Tuesday after the gloomy data.

As of market close on Tuesday, the Dow Jones industrial average tumbled 133.96 points, or 1.32 percent, to 10,040.45, after the blue-chip index briefly slipping under 10,000 for the first time since early July.

The Standard & Poor's 500 index sank 15.49 points, or 1.45 percent, to 1,051.87, paring a drop of as much as 1.9 percent, and the Nasdaq plunged 35.87 points, or 1.66 percent, to end at 2,123. 76.

On foreign exchange market, the dollar tumbled to a 15-year low against the yen as worries about a slowdown in the global economy boosted currencies seen as safer bets. The euro was nearly flat at 1.2673 dollars in New York late trading.

Light, sweet crude for October delivery dropped 1.47 dollars to settle at 71.63 dollars a barrel on the New York Mercantile Exchange.

In London, Brent crude lost 1.24 dollars to settle at 72.38 dollars a barrel on the ICE futures exchange.

Source: Xinhua


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