U.S. Stocks Close Down; Investors Concerned About Chinese Slowdown, Ignore U.S. Housing Data

4:00 PM, Mar 20, 2012 -- U.S. stocks slumped Tuesday as concerns about slowing growth in China caused a broad market sell-off. In pre-market hours, BHP's Iron Ore Division president Ian Ashby remarked that China's demand for iron ore will drop "to single digits, if it is not already there," which sparked concern that growth in world's second largest economy is cooling.

The statement by Ashby first hit commodities, but later spilled over into equities. Trader's concern of a possible slowdown was given extra impetus following an announcement by Chinese officials that they will allow gas prices to rise in an effort to compensate for higher oil prices.

Traders also responded to reports of a drop in home prices in 45 Chinese cities, the result of government efforts to curb property speculation, and mixed news on the U.S. housing market. Nine of the 10 sectors in the S&P 500 are trading lower, with financial stocks continuing their recent run higher as the lone sector in positive territory.

Stateside, building permits surged 5.1% during February to a seasonally adjusted annual rate of 717,000 units, up from a revised 682,000-unit rate in January, the Commerce Department said. That made for the fastest pace since October 2008 and easily topped estimates by experts in a Thomson Reuters poll for a rise to a 690,000-unit pace last month. Compared to year-ago activity, new permits were up 34.3% during February.

Housing starts, however, fell 1.1% last month to an annualized rate of 698,000 units. January's starts were revised up to a 706,000-unit pace from a previously reported 699,000 unit rate. The economists in the Reuters poll had forecast a 700,000-unit rate.

In company news, Agrium Inc. (AGU) climbed following the company's announcement that it has entered into a definitive agreement with Glencore International to acquire the majority of Viterra's Agri-products business upon completion of Glencore's recently announced acquisition of Viterra. For approximately $1.15 bln, AGU will acquire 90% of Viterra's Canadian retail facilities, all of its Australian retail facilities, as well as their minority position in a nitrogen facility located in Medicine Hat, Alberta, as reported by StreetInsider.

Gordmans Stores (GMAN) surged following the retailer's report that Q4 net income rose 21.2% compared with its year-ago profit to $10.2 million. On a per-share basis, quarterly profit was $0.53. Net sales increased 10.0% to $185.1 million. Analysts, on average, were expecting $0.40 a share, according to Thomson Reuters. The discount department store operator also forecast Q1 and FY12 profits and sales that crushed Street opinion.

Commodities closed down. Crude slumped 2.3% to close at $105.61 a barrel after Saudi Arabia said it would ramp up its production to meet any shortfalls in global supplies. The potential slowdown in China hit gold prices, gold for April delivery declined $20.30, or 1.2%, to end at $1,647 an ounce.

Here's where the markets stood at end-of-day:

NYSE Composite down 0.74%

Dow Jones Industrial Average down 0.52%

S&P 500 down 0.30%

NASDAQ Composite down 0.14%

GLOBAL SENTIMENT

Nikkei 225 up 0.12%.

Hang Seng Index down 1.08%.

China Shanghai Composite down 1.38%.

FTSE 100 down 1.07%.

UPSIDE MOVERS

(+) ROSG, Company's microRNA technology cited for determining likely cancer recurrences

(+) WMB, Acquiring Caiman Eastern Midstream LLC for approximately $2.5 billion

(+) AMPE, Received notice of allowance from the US Patent Office

DOWNSIDE MOVERS

(-) DHT, Announced plans for a backstopped $80-million equity offering

(-) TRGT, Stops work on new anti-depressant after poor results in late-stage clinical study

(-) ADBE, Posts lower-than-expected Q1 revenues