May 31 (Bloomberg) -- U.S. stocks fell, sending the Standard & Poor’s 500 Index toward its biggest monthly decline since September, amid disappointing economic reports.
Joy Global Inc., a maker of mining equipment, slumped 7.7 percent after cutting earnings and revenue forecasts. TiVo Inc. slid 5.5 percent as the digital video recorder pioneer reported a loss. Facebook Inc. lost 2.2 percent, extending a 26 percent decline since it went public this month. Talbots Inc. almost doubled as the retailer agreed to be bought by Sycamore Partners for $369 million including debt.
The S&P 500 retreated 0.8 percent to 1,303.02 at 10:06 a.m. New York time. The Dow Jones Industrial Average dropped 56.23 points, or 0.5 percent, to 12,363.63 today.
“There’s less of a growth backstop to the global economy,” said Alan Gayle, a senior strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees about $47 billion. “The U.S. has held the position of stabilizing factor amid all the concern about Europe’s crisis. To the extent that the latest numbers suggest that momentum in the U.S. is slowing, that will make investors more nervous.”
Equities fell as data showed gross domestic product climbed at a 1.9 percent annual rate from January through March, down from a 2.2 percent prior estimate. The number of Americans applying for unemployment insurance payments rose last week to a one-month high. Companies in the U.S. added 133,000 workers in May, according to ADP Employer Services, missing estimates. The Institute for Supply Management- Chicago Inc. said today its barometer decreased to 52.7 from 56.2 in April. Readings greater than 50 signal growth.
“Bottom line, as also seen in the ADP report, the labor market is no better than just OK,” Peter Boockvar, equity strategist at Miller Tabak & Co. in New York, wrote in a note.
Investors also watched the latest developments in Europe’s attempts to tame its crisis. Spanish and Italian bonds gained as polls suggested Irish voters will back Europe’s fiscal treaty. Concern about Europe’s debt turmoil drove the S&P 500 down 6.8 percent so far in May. Financial, commodity and technology companies have fallen at least 8 percent in the period. The gauge is on pace for a second straight monthly decline, following the best first-quarter gain since 1998.
Joy Global retreated 7.7 percent to $54.51. It cut forecasts as mining companies reduced capital expenditure amid concern over the slowdown in Chinese economic growth.
TiVo lost 5.5 percent to $8.47 as hardware costs rose and the company said legal expenses in the current period would lead to a wider loss than analysts expected.
Kohl’s Corp. retreated 5 percent to $46.40 after the retailer said May same-store sales decreased 4.2 percent. That compares with the average estimate for a 1.1 percent decline.
Facebook, which this week fell below $30 for the first time, dropped 2.2 percent to $27.56. Investors have pummeled the shares, citing concern over growth prospects for the largest social-networking service.
Talbots climbed 92 percent to $2.48. Shareholders will get $2.75 per share, the Hingham, Massachusetts-based retailer said today in a statement. That’s lower than the most recent offer of $3.05 per share.
TJX Cos. rose 1 percent to $41.74. The owner of the T.J. Maxx and Marshalls retail chains posted an 8 percent increase in same-store sales, topping the 5.1 percent estimate as warm weather and lower gasoline prices boosted consumer spending.
“Traffic trends have picked up as hot summer weather spread over the majority of the nation,” Adrienne Tennant, an analyst at Janney Montgomery Scott LLC in Washington, wrote in a note.
Ciena Corp. climbed 6.8 percent to $12.69. The maker of networking equipment rose after second-quarter sales and earnings topped analysts’ estimates. Ciena is capitalizing on demand for speedy fiber-optic networks, which transmit data in the form of light over fiber strands.
The S&P 500 may rebound almost 3 percent in June based on the average size of moves following past May declines of 4 percent or more, Bespoke Investment Group said.
The benchmark gauge has fallen 4 percent or more in May on 15 occasions since 1928, followed by an average June increase of 2.8 percent, according to data compiled by Bespoke. The index rose in June 60 percent of the time following such moves.
The last time the S&P 500 slid more than 4 percent during May of a U.S. presidential election year was in 1984, when it tumbled 5.9 percent before rebounding 1.8 percent in June. This year’s slide may also mark a bottom for the market followed by a June rally, Justin Walters, Bespoke’s co-founder, said in a phone interview yesterday.
“The data certainly leans positive,” Walters said. “Along with the election analysis and the big down Mays, the risk-reward favors the market going positive here.”
The S&P 500 has averaged a gain of 0.51 percent in June following an increase in May, the Bespoke report showed, and the index has risen 0.96 percent in June after May declines. Its performance next month ultimately will be determined by Europe’s handling of the government-debt crisis, according to Walters.