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US STOCKS-Wall St slips after new home sales drop

Published 10/28/2009, 10:30 AM
Updated 10/28/2009, 10:33 AM
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* New home sales fall unexpectedly in September

* Apollo drops after regulators launch inquiry

* Dow off 0.1 pct, S&P off 0.5 pct, Nasdaq off 0.6 pct

* For up-to-the-minute market news, click [STXNEWS/US]

(Updates to midmorning)

By Leah Schnurr

NEW YORK, Oct 28 (Reuters) - U.S. stocks fell on Wednesday after September new home sales unexpectedly tumbled and analysts said there was little in the way of catalysts to further fuel the market's seven-month rally.

Data showed sales of newly built single-family homes slid 3.6 percent in September, their first drop since March. For details, see [ID:nN28296063].

"We're going to see pockets of strength some months, then weakness in others," said Peter Lewis, fund manager at Murphy Capital Management in Gladstone, New Jersey.

"People were more hopeful that we'd see stabilization quicker, and we're heading in that direction, but it's going to take some time."

A report earlier in the morning showed new orders for long-lasting manufactured goods rose 1 percent in September, suggesting the economy was steadying, but the data's impact was limited as it matched economists' expectations. [ID:nN28295073]

The Nasdaq fared worse than the other two indexes as Apollo Group Inc shed 15.2 percent to $61.86 after it said federal regulators had launched an informal inquiry into its revenue recognition practices. At least three brokerages downgraded the company. [ID:nBNG336127]

Visa Inc jumped 4.8 percent to $77.45 the day after it posted a stronger-than-expected quarterly profit, raised its dividend and authorized a stock-buyback plan. [ID:nN27264293]

The Dow Jones industrial average <.DJI> was off 4.54 points, or 0.05 percent, to 9,877.63. The Standard & Poor's 500 Index <.SPX> lost 4.90 points, or 0.46 percent, to 1,058.51. The Nasdaq Composite Index <.IXIC> gave up 12.47 points, or 0.59 percent, at 2,103.62. (Additional reporting by Ryan Vlastelica; Editing by Padraic Cassidy)

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