Stocks slumped Tuesday, sending the Standard & Poor's 500 index to its biggest decline this year, as concern grew about the success of a Greece debt deal and after a report showed that the European economy contracted.
The S&P 500 lost 20.97 points, or 1.5%, to 1343.36. All 10 groups in the S&P 500 fell as financial, commodity and industrial shares had the biggest losses. The Dow Jones industrial average slid 203.66 points, or 1.6%, to 12,759.15, its biggest drop since November. The Nasdaq composite index slid 40.16 points, or 1.4%, to 2910.32.
"Investors typically dislike uncertainty more than they dislike bad news," says Michael Koskuba, money manager at Victory Capital Management. "There's concern about whether or not there will be enough participants in the Greek debt swap. The fear is that if it doesn't happen the way most want it to happen, there's potential for a greater recession in Europe."
The MSCI All-Country World index sank 2.2%, its worst drop since November. Private investors that so far declared their participation in Greece's debt restructuring hold about 20% of the bonds involved in the swap, which ends March 8, required for a bailout. Europe's economy shrank 0.3% last quarter and the central bank's balance sheet surged to a record 3.02 trillion euros ($3.96 trillion).
Tuesday's loss sent the S&P 500 down for a third session in a row amid concern this year's gain has outpaced global economic prospects. The rally that restored more than $3.2 trillion to U.S. stock value since October had sent the benchmark gauge near an almost four-year high last week. Data Tuesday showed that Brazil's economy last year registered its second-worst performance since 2003, while China on Monday cut its economic growth target.
Highlights: Nutrisystem tumbled $1.30, or 11%, to $10.58, its lowest since May 2005. The provider of prepared meals to help clients lose weight forecast annual earnings per share of no more than 55 cents, falling short of the average analyst projection of 92 cents a share, Bloomberg data show.
Zeltiq Aesthetics fell $3.75 to $7.36, a 34% drop that was the most since it went public in October. The maker of fat-reduction technology forecast 2012 sales below analysts' estimates.
Encore Bancshares surged $5.28 to $20.19, a 35% gain that was its biggest since going public in 2007. The Houston-based bank agreed to be bought by Cadence Bancorp for $20.62 a share, or about $250 million.
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