Stocks Slide on Service Company Data

Stocks Slide on Service Company Data

NEW YORK (AP) -- U.S. stocks are turning lower Tuesday morning after a survey found that services companies grew at their slowest pace in six years in August. That sent consumer companies to hefty losses and pushed bond yields lower. A slew of companies used the Labor Day holiday to make deals. Bayer raised its offer for seed company Monsanto yet again, to $55.8 billion, while Canada's Enbridge agreed to buy Spectra Energy for $28 billion.

KEEPING SCORE: The Dow Jones industrial average lost 27 points, or 0.2 percent, to 18.464 as of 10:22 a.m. Eastern time. The Standard & Poor's 500 index slid 9 points, or 0.4 percent, to 2,171. The Nasdaq composite dipped 1 point to 5,248.

SURVEY SHOCK: The Institute for Supply Management said U.S. service companies grew at a far slower pace in August than they had in July. While service firms have expanded every month for more than six years, the reading on the survey was the weakest since February 2010. New orders and hiring grew at a slower rate and exports fell. Service firms accounted for almost all of U.S. job creation last month.

Consumer companies took heavy losses. Department store Nordstrom fell $2, or 3.9 percent, to $49.87 and shoe and athletic wear maker Nike lost 60 cents, to 1 percent, to $57.53. Used car company CarMax gave up 78 cents, or 1.3 percent, to $59.28 and media company Disney sank 95 cents, or 1 percent, to $93.47.

GREEN HARVEST: German health care and chemicals conglomerate Bayer raised its offer for Monsanto to $127.50 a share. The latest offer values Monsanto at around $55.8 billion, or about $1 billion more than Bayer had offered preciously. Monsanto has already rejected two bids from Bayer. Its stock inched up 6 cents to $107.50.

ENERGIZED: Spectra Energy climbed $4.74, or 13.1 percent, to $40.89 after it agreed to be bought acquired. Enbridge will pay about $40.33 in cash and stock, or $28 billion, in a deal that would make North America's biggest energy infrastructure company.

DIAGNOSTICS DEAL: Industrial and medical device company Danaher will buy molecular diagnostics company Cepheid for $53 per share, or about $4 billion. Cepheid will become part of Danaher's diagnostics business, and its stock climbed $17.91, or 52 percent, to $52.33 while Danaher dipped 93 cents, or 1.1 percent, to $80.26.

YATES SAYS YES: EOG Resources said it will buy oil and natural gas company Yates Petroleum for about $2.3 billion, mostly in stock. EOG gained $4.70, or 5.3 percent, to $93.61.

HIT THE GAS: Bus, truck and engine maker Navistar surged after it announced an investment from a unit of Volkswagen. The companies are also creating a joint venture that will help source parts for each of them, and they will share technology. Volkswagen Truck & Bus will pay $256 million for a 16.6 percent stake in Navistar. It will also name two directors to Navistar's board, and the company said Tuesday that chairman James Keyes will retire.

Navistar rose $8.39, or 60 percent, to $22.46, far above the $15.76 a share Volkswagen Truck & Bus is paying. Rival engine maker Cummins lost $6.92, or 5.5 percent, to $119.24.

FOX SETTLEMENT: 21st Century Fox fell 29 cents, or 1.2 percent, to $24.26 after agreeing to settle a sexual harassment lawsuit brought by former Fox News Channel anchor Gretchen Carlson. The case was brought against former Fox News CEO Roger Ailes. The company also apologized for the way Carlson was treated.

ENERGY: Benchmark U.S. crude oil fell 2 cents to $44.19 a barrel in New York. Brent crude, the benchmark for international oil prices, lost 94 cents, or 2 percent, to $46.69 a barrel in London.

BONDS, CURRENCIES: U.S. government bond prices rose. The yield on the 10-year Treasury note declined to 1.56 percent from 1.61 percent late Friday. The dollar sank to 102.57 yen from 103.94 yen Friday. The euro rose to $1.1245 from $1.1159.

OVERSEAS: France's CAC 40 added 0.3 percent and in Germany the DAX gained 0.5 percent. Britain's FTSE 100 shed 0.7 percent. The Nikkei 225 index in Japan rose 0.3 percent and in South Korea, the Kospi added 0.3 percent. Hong Kong's Hang Seng advanced 0.6 percent.