Stock market sags following Kerry remarks

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Associated Press

Posted on August 26, 2013 at 2:02 PM

Updated Monday, Aug 26 at 2:36 PM

NEW YORK (AP) — The stock market sagged Monday after the Obama administration ratcheted up pressure against Syria.

Secretary of State John Kerry said there was "undeniable" evidence of a large-scale chemical weapons attack in Syria last week, and his remarks suggested that the administration was edging closer to a military response.

Major indexes had been holding onto slight gains on Monday until the last hour of trading. That's when Kerry's televised talk appeared to jolt it lower, said Stephen J. Carl, head equity trader at the Williams Capital Group.

The S&P 500 index ended with a loss of 6.72 points, or 0.4 percent, at 1,656.78. The index was up two points just before Kerry began reading his statement.

The Dow Jones industrial average fell 64.05 points, or 0.4 percent, to close at 14,946.46. The Nasdaq composite slipped 0.22 of a point, or 0.01 percent, to 3,657.57.

A handful of corporate deals gave the market a lift in the early going. Amgen surged following its announcement late Sunday that the biotech giant plans to buy Onyx Pharmaceuticals for $10.4 billion. The acquisition would give Amgen three approved cancer treatments and several other potential drugs.

In economic news, the government reported that orders for long-lasting manufactured goods plunged 7.3 percent last month, the steepest drop in nearly a year. Demand for commercial aircraft sank and businesses spent less on computers and electrical equipment.

Jack Ablin, the chief investment officer at BMO Private Bank in Chicago, said it's likely that investors are looking past the one bad economic report because so many major events loom ahead.

The Federal Reserve will start a two-day meeting Sept. 17, during which officials will discuss phasing out support for the economy. After that, Germany holds national elections that could change how the region handles rescue loans for troubled countries. The U.S. Congress returns from its summer break next week and will take up a new budget before the fiscal year starts on Oct. 1.

"These issues are big enough to transcend daily data," Ablin said.

The market is expected stay quiet this week, when many traders typically take a summer break before returning after Labor Day.

In corporate news, shares of TMS International jumped 12 percent after members of the Pritzker family agreed to buy the industrial company. The Pritzker family, one of America's wealthiest, operates a global industrial conglomerate and founded the Hyatt hotel chain. TMS jumped $1.91 to $17.48.

With five trading days left in August, the major indexes are on track to end the month with slight losses. The Dow has lost 3.6 percent. If that holds, it would be the Dow's worst month since May 2012.

In the market for U.S. government bonds, the yield on the 10-year note slipped to 2.78 percent from 2.82 percent late Friday.

The price of oil fell 50 cents to $105.92 a barrel. Gold for December delivery ended the regular trading day down $2.70 at $1,393.10 an ounce. But in evening trading, gold prices crossed above $1,400 for the first time since June.

Among stocks making big moves:

— Anadarko Petroleum climbed $1.22, or 1 percent, to $91.02. The oil and gas producer said late Sunday that it's selling part of its stake in a natural-gas site off the shores of Mozambique for $2.64 billion.

— Amgen gained $8.15, or 8 percent, to $113.75 after earlier hitting an all-time high of $116.25. Onyx, the drugmaker it plans to acquire for $125 a share, rose $6.53, or 6 percent, to $123.49.

— Tesla, the electric-car maker, climbed $2.38, or 1 percent, to $164.22, following reports that Tesla's Model S outsold Cadillac, Porsche, Jaguar and other brands in California in June.

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