- 02Aug
(Reuters) - Stocks declined on Tuesday, putting the S&P 500 on track for its longest down streak since October 2008, on worries over the United States' debt and economic outlook.
Investors feared a possible downgrade of U.S. credit despite passage by the U.S. House of Representatives Monday of a last-minute compromise to raise the U.S. debt ceiling and avert a U.S. debt default.
The deliberations have taken a toll on stocks. The S&P 500 is down for its seventh straight session. Last week, the market suffered its worst week in a year.
Even with the deal, analysts say it is possible the United States top credit rating could still be cut.
In the latest economic data, U.S. consumer spending fell unexpectedly in June to post the first decline in nearly two years as incomes barely rose, the government reported.
Among the day's weakest sectors was consumer discretionaries, with the S&P sector index .GSPD down 1.6 percent.
A weak reading on manufacturing on Monday underscored growing concerns about the economy's strength.
"I think people are worried about a double-dip recession and the softening economic statistics," said Jeffrey Saut, Raymond James Financial chief investment strategist, in St. Petersburg, Florida. But he said, "it's not the snake you see that bites you, and these figures are so well advertised."
Saut sees the market bottoming in the weeks ahead, especially if the S&P 500 trades between 1,220 and 1,250.
The Dow Jones industrial average .DJI was down 98.61 points, or 0.81 percent, at 12,033.88. The Standard & Poor's 500 Index .SPX was down 13.48 points, or 1.05 percent, at 1,273.46. The Nasdaq Composite Index.IXIC was down 22.50 points, or 0.82 percent, at 2,722.11.
European debt problems returned to the forefront after French bank BNP Paribas SA (BNPP.PA) took a $768.3 million write-down linked to Greece's debt woes.
(Additional reporting by Ryan Vlastelica; Editing by Kenneth Barry)
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