Wall Street stocks tumble after weaker growth in Q4

The month of February turned to be stronger month for the US stocks, but it ended in modest fashion.

The US economy grew at the annual pace of 2.2 percent in the fourth quarter, according to the US Commerce Department. The expansion of economic activity was sluggish in the fourth quarter of 2014 as it was restrained by a widening trade gap and smaller gain in stockpiles.

Major stock indexes were lower on Friday at the closing trade as they capped a week of subdued trading that continued delivering a couple of new highs for both Standard & Poor’s 500 index and Dow Jones industrial average. The Nasdaq composite was also brought within outstanding distance of its 2000 high in March.

The Nasdaq witnessed the largest monthly gain at 7.1 percent, while the S&P 500 saw 5.5 percent gain that marked its best monthly hike since October 2011, and a turnaround from its drop of 3.1 percent recorded in January. The Dow Jones industrial average increased 5.6 percent for the month.

TD Ameritrade’s chief strategist JJ Kinahan, said, “It’s a wait-and-see attitude. Many people are trying to figure out what to do, taking some profits when they can. We saw that over the past couple of days with tech stocks.”

The S&P 500 slipped 6.24 points, or 0.3 percent, to 2,104.50, while the Dow ended down 81.72 points, or 0.5 percent, to 18,132.70.  The S&P 500 index slipped 0.5 from a high of 2,115.48 on Tuesday and Dow was 0.5 percent below its latest high of 18,224.57 on Wednesday.

The Nasdaq, on the other hand, dropped 24.36 points, or 0.5 percent, to 4,963.53. The index has inched closer to crossing the 5,000-point mark.

The three main stock indexes of the United States are all up for the current year.

The current bull market, which is now in its sixth year, turned stronger after being boosted by healthy growth in corporate earnings and low rates of interest, which make stocks more attractive relative to bonds.

The improving consumer confidence and strong growth in the jobs front also encouraged traders, despite indications of sluggishness in Europe and elsewhere.