The U.S. stocks fell on Friday, as concerns over technology sector offset a strong growth of U.S. gross domestic product (GDP) data, ending the first month of the year in the red.
All major averages closed out January on down note. The Dow Jones Industrial Average dropped 53.13, or 0.52 percent, to 10,067. 33. The Standard & Poor’s 500 index fell 10.66, or 0.98 percent, to 1,073.87 and the Nasdaq tumbled 31.65, or 1.45 percent, to 2, 147.35.
For the whole month, the Dow Jones was down 3.5 percent, which was its first monthly decline since October and the biggest since it plunged 11 percent last February. The S&P dropped 3.7 percent and the tech-heavy Nasdaq gave up 5.4 percent.
Friday’s decline came after a government report showed U.S. economy expanded at the fastest pace in over six years. According to the Commerce Department, U.S. GDP jumped at a seasonally adjusted 5.7-percent annual rate in the fourth quarter of 2009, the biggest since the third quarter of 2003. The growth was over one percentage point higher than expected, pushing major averages up over 1 percent in the earlier session.
Technology sector helped erase all the gains afterwards even after major companies posted better-than-expected earnings, as investors took the good news as a good opportunity for locking in profits.
Microsoft fell 3.36 percent to finish the session at 28.18 dollars per share, although the software giant posted a 60-percent rise in fiscal second-quarter profit and easily topped estimates, benefiting from improving personal computer sales and the recent release of its flagship Windows 7 operating system.
Amazon.com dipped 0.49 percent to end at 125.41 dollars per share after it reported a 71-percent profit surge and forecast strong 2010 revenue.
For those companies who did miss the market expectation, their stocks saw a ruthless sell-off during the day.
Sandisk, the biggest maker of flash-memory cards for digital cameras and mobile phones, fell 12 percent to 25.42 dollars per share in its biggest decline in almost a year, because the company anticipated sales of 875 million dollars to 950 million dollars in the first quarter, lower than the average estimates among analysts.
Avery Dennison Corp. slumped 15 percent to 32.51 dollars per share, marking the biggest drop in the S&P 500. The world’s largest label maker reported fourth-quarter earnings excluding some items of 44 cents a share, missing the average analyst estimate.
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