Economy hits small caps
The Russell 2000 (NYSE: IWM) is posting heavy losses as concerns about the U.S. economy keep mounting. At 2:33 p.m. ET, the small-cap index had declined 16.90 points, or 2.39%, to 688.82. The Dow Jones Industrial Average (INDU) was missing 294.38 points, or 2.34%, to 12,287.80.
Stocks are sinking following a slew of negative economic and corporate news.
The National Association of Purchasing Managers-Chicago reported after the opening that its index of regional business conditions fell to a lower-than-expected level of 44.5 in February from 51.5 in January. A reading below 50 indicates a contraction.
Elsewhere, the University of Michigan said after the opening that its index of consumer confidence fell to a reading of 70.8 in February. That’s up from the preliminary estimate of 69.6 but still represents the worst result since 1992.
A separate report by the U.S. Commerce Department before the opening showed that spending increased 0.4% in January, above the projected 0.2%.
Investors disregarded that news as the same report also showed that year-over-year inflation is above the U.S. Federal Reserve’s preferred range. The Russell 2000 opened in the red and slid down even further in the early afternoon.
But there are a few bright spots amidst the carnage on Wall Street.
Shares of Euroseas Ltd. (Nasdaq: ESEA) are higher following news that the Greek shipping company got upgraded to “buy” from “hold” by an analyst.
Similarly, U-Store-It Trust (NYSE: YSI) has risen after its CEO said the real estate investment trust can benefit from the housing downturn.
“Along with marriage and divorce, I’m ready to add home foreclosures as an additional life-changing event that brings us business,” Dean Jernigan said in a conference call after the start of trading. However, the Cleveland, Ohio-based company projects a loss of between $0.12 per share and $0.10 per share.
Meanwhile, Morton’s Restaurant Group, Inc. (NYSE: MRT) served up bullish news when it announced after the close on Thursday that fourth-quarter revenues rose 10.6% to $100.5 million, compared with $90.9 million a year earlier. Shares are up more than 15%.
