U.S. Stocks Decline; American Express, Tiffany Fall on Outlooks

(Bloomberg) -- U.S. stocks fell as lower-than- estimated profit forecasts at American Express Co. and Tiffany & Co. heightened concern the economy is shrinking and sent the Standard & Poor's 500 Index to its worst start since 1991.

American Express, the third-largest U.S. credit-card network, fell in New York Stock Exchange trading after its projection for first-quarter earnings trailed analysts' estimates by 3.2 percent. Tiffany, the second-biggest luxury jewelry seller, lost the most in more than three years after holiday sales growth shrank to 8 percent. Countrywide Financial Corp. retreated after Bank of America Corp. agreed to buy the mortgage lender for less than its market value.

The Standard & Poor's 500 Index slipped 9.68, or 0.7 percent, to 1,410.73 as of 12:52 p.m. in New York, extending its decline this year to 3.9 percent. The benchmark for U.S. equities has dropped for three straight weeks, the longest streak since August. The Dow Jones Industrial Average decreased 163.79, or 1.3 percent, to 12,689.3. The Nasdaq Composite Index dropped 28.17, or 1.1 percent, to 2,460.35. About two shares declined for every one that rose on the NYSE.

``There was this perception that the upper-end consumer was resistant to the economy, and that may be starting to roll over,'' said Matthew Kaufler, who helps manage $2.6 billion at Clover Capital Management in Rochester, New York. ``Housing has been in recession, the financial institutions are also feeling it, and now you have signs that the consumer is starting to buckle. We seem to be in a rolling recession.''

 

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