US stocks Thursday kicked off the new year in the red, falling decisively in a selloff that analysts chalked up to profit-taking following solid gains in 2013.
The Dow Jones industrial average fell 135.31 points to 16,441.35. The S&P 500 declined 16.38 to 1,831.98, while the tech-rich Nasdaq Composite Index fell 33.52 to 4,143.07.
Markets were closed Wednesday for the New Year’s Day holiday.
Analysts said investors likely took the first day of trading of 2014 as an opportunity to rebalance portfolios after markets surged last year, pushing the S&P 500, a broad measure of the markets, up nearly 30 percent.
A typical strategy is to wait to rebalance until a new tax year, said Sam Stovall, chief investment officer at S&P Capital IQ.
The retreat came despite reports that showed the strongest US construction spending in four years and a solid reading on US manufacturing activity. Tempering that data was a mediocre report on Chinese manufacturing activity, Stovall said.
Shares of tech giant Apple fell 1.4 percent after Wells Fargo downgraded the stock on concerns about its profit-margin outlook. Online professional networking service LinkedIn lost 4.2 percent after Citigroup cautioned that tracking information on LinkedIn activity suggested
“near-term caution” on the stock.
Bank of America jumped 3.4 percent after Citigroup upgraded the stock.
Bond prices rose. The yield on the 10-year US Treasury bond fell to 2.99 percent from 3.03 percent Tuesday.