U.S. Stocks as the fall of S & P 500 has biggest weekly decline in three months

U.S. stocks fell, giving the Standard & Poor's 500 Index its biggest weekly decline in three months, as concern about the debt crisis in Europe intensified speculation that China will raise interest rates grew and Cisco Systems Inc. 's loss projection analysts estimated.

Alcoa Inc., Hewlett-Packard Co. and JPMorgan Chase & Co. has recalled more than 3.2 percent to help lead to losses in the Dow Jones Industrial Average. Cisco, the world's largest maker of networking equipment, plunged 17 percent in the biggest weekly decline in two years. Boeing Co., the largest aerospace company, fell 11 percent after the suspension of flights of the 787 Dreamliner, while investigating a fire in a test aircraft.

The S & P 500 lost 2.2 percent to 1,199.21, snapping a five-week concentration. The Dow Jones fell 251.50 points, or 2.2 percent, to 11,192.58, after gaining 14 percent since late August and up to a maximum of two years.

"There remains a risk, at risk, market-off," said Mike Ryan, director of New York's wealth management research for the Americas at UBS Financial Services Inc., which oversees about 641 billion U.S. dollars. "There is a sense of 'toppiness', with some concern about what is happening in the euro area. We had this huge face and it is not surprising when these issues emerge risk seeing markets around the world look concerned. "

The S & P 500 gained 20 percent from its low in July 2010 amid improving profits and speculation that the Federal Reserve will stimulate growth by pumping more money into the financial markets. Earnings per share exceeded estimates by 76 percent of the 433 companies in the index that was reported from the 07 of October, according to data compiled by Bloomberg.

'Significant' selloff

Gary Shilling, who predicted the collapse of U.S. housing, says the stock market is overvalued and predicts a "significant" wave of sales within a year, the Federal Reserve will not stimulate economic growth through technique was also used last year, known as quantitative easing.

"I do not think it's enough to make a big difference," said Shilling, 73, president of investment research firm A. Gary Shilling & Co. in Springfield, New Jersey, in a telephone interview. "The sooner QE1 did not and do not believe this, either. The economy is weak and not much of a shock to push it into negative territory. I do not think that is enough to justify where stocks are now."

The MSCI World Index published the third weekly decline in a month and the euro fell to a six-week low against the dollar and German finance ministers, French and British met at the Group of 20 nations meeting in the debt crisis Ireland. The benchmark for developed countries fell 0.9 percent yesterday amid speculation that China will raise interest rates.

"Everything is red '

"Everything is red," said John Lynch, chief equity strategist at Wells Fargo Funds Management, which oversees 465 billion U.S. dollars. "We've had a good sprint. I believe that fiscal policy is the key here now."

The S & P 500 Finance was the biggest drop among 10 industries this week, falling 4 percent.

Tech stocks in the S & P 500 fell 3.2 percent after Cisco said revenue in the second fiscal quarter will be about 10.1 billion U.S. dollars to $ 10.3 million. Excluding some costs, profit will be 35 cents per share maximum. Analysts projected sales of $ 11.1 billion and earnings of 42 cents on average, according to estimates compiled by Bloomberg.

Cisco shares had the biggest daily drop since July 1994 on 11 November and dropped 17 percent to $ 20.15 a week.

Boeing

Boeing plunged 11 percent to $ 63.09. Chief executive Jim McNerney on Nov. 11, said the company should know "quite quickly" if the fire this week aboard a 787 Dreamliner affect the entry of the aircraft in service, which is almost three years late.

Intel Corp. gained 1.4 percent to $ 21.53. largest chipmaker in the world said it will increase its quarterly dividend 14 percent to 18 cents per share, beginning with the payment stating the next quarter as a rebound in demand for personal computers increases their profits.

The quarterly reports scheduled for next week include Home Depot Inc. and Lowe's Cos., the largest U.S. merchants Home Improvement and Wal-Mart Stores Inc., the world's largest retailer. Dell Inc., the world's third largest personal computer, Staples Inc., the largest retailer of office supplies, and HJ Heinz Co., the largest maker of ketchup, you must also report the results.

Retail sales probably rose in October for the fourth month and factory production rebounded, adding to evidence the U.S. recovery collected at the beginning of the fourth quarter, economists said before reports next week.