Stocks slip after retail sales weaken, China slows

NEW YORK - Mounting signs of weakness in the global economy and a poor start to the holiday shopping season knocked the stock market lower Monday.

Earlier sales, a shift to online shopping, and stagnant wages meant fewer Americans showed up at stores over the Thanksgiving weekend, the National Retail Federation said Sunday. The trade group estimated that total spending for the four days totaled $50.9 billion, down 11 percent from last year.

Major retailers slumped in response. Macy's lost $1.72, or 3 percent, to $63.19 and Target fell $1.25, or 2 percent, to $72.75. Best Buy lost $2.15, or 6 percent, to $37.26.

New reports of slowing manufacturing in China as well as in the three largest economies that use the euro - Germany, France, and Italy - also gave investors little reason to cheer.

The Standard & Poor's 500 index fell 14.12 points, or 0.68 percent, to close at 2,053.44. The losses were widespread: General Electric and other industrial companies led eight of the 10 sectors in the index down.

The Dow Jones industrial average dropped 51.44 points, or 0.29 percent, to 17,776.80, while the Nasdaq composite fell 64.28 points, or 1.34 percent, to 4,727.35.

DreamWorks Animation slumped after its latest movie, Penguins of Madagascar, had a weaker box-office opening over the Thanksgiving weekend than analysts had expected. The sequel to its popular Madagascar movie took second place to the newest installment of the Hunger Games series. DreamWorks' stock fell $1.33, or 6 percent, to $22.51.

In the bond market, the yield on the 10-year Treasury note rose to 2.23 percent from 2.16 percent late Friday. High demand for U.S. government bonds has kept yields low.

Precious metals surged. Gold jumped $42.60 to settle at $1,218.10 an ounce, while silver surged $1.14 to $16.69 an ounce. Copper rose five cents to $2.90 a pound.

In energy trading, oil posted its biggest percentage gain in more than two years, stemming a rout that had knocked about $40 off the price of a barrel of crude since June. Analysts still expect oil prices to remain weak given OPEC's decision last week to maintain its current production targets. That, combined with rising production in the United States, has created an oversupplied oil market. Benchmark U.S. crude jumped $2.85, or 4 percent, to close at $69 a barrel on the New York Mercantile Exchange.

In other NYMEX trading, wholesale gasoline rose five cents to $1.88 a gallon; heating oil rose five cents to $2.21 a gallon; and natural gas fell eight cents to $4.01 per 1,000 cubic feet.