* Central banks scale back liquidity programs
* Aug existing homes sales fall unexpectedly
* Dow off 0.4 pct; S&P 500 off 1 pct; Nasdaq off 1.1 pct
* For up-to-the-minute market news, click []
(Updates to close)
By Ellis Mnyandu
NEW YORK, Sept 24 (Reuters) - U.S. stocks fell on Thursday
as signs of weakness in housing and investors' worries that
authorities might be curbing stimulus efforts too soon sparked
caution.
World central banks said they would scale back infusions of
U.S. dollars into their banking systems, fueling unease
triggered a day earlier when stocks sold off following the U.S.
Federal Reserve's decision to slow purchases of mortgage debt.
For details, see []
That program has been one of the key pillars of the Fed's
efforts to support mortgage lending.
Thursday's losses drove the benchmark S&P 500, which has
rallied nearly 60 percent in six months from 12-year lows, to
its worst two-day drop in three weeks as investors pummeled
stocks across the board.
All 10 S&P 500 sectors fell, with materials, energy,
financials and industrials faring the worst.
"The housing number today probably threw some gasoline on
the fire," said John Kosar, market technician and president of
Asbury Research in Chicago. "It's not only that the recovery is
fragile, but the other important story is just how far the
market has come, so fast. The Fed statement was a little bit
sobering."
The Dow Jones industrial average <> dropped 41.11
points, or 0.42 percent, to 9,707.44. The Standard & Poor's 500
Index <.SPX> fell 10.09 points, or 0.95 percent, to 1,050.78.
The Nasdaq Composite Index <> slid 23.81 points, or 1.12
percent, to 2,107.61.
On the housing front, the National Association of Realtors
said sales of existing homes fell 2.7 percent to an annual rate
of 5.10 million units, a drop that dented some of the optimism
that followed four months of gains in home sales. For details,
see []
The Dow Jones U.S. Home Construction index <.DJUSHB> fell
2.4 percent. Among shares of major homebuilders D.R. Horton
<DHI.N> sank 4.2 percent to $11.93, while Toll Brothers <TOL.N>
shed 2.3 percent to $20.21 and Beazer Homes <BZH.N> lost 4
percent to $5.78.
"With a market that has had such an explosive recovery from
its lows, any kind of news that has people second-guessing the
recovery will give people an excuse to sell," said Craig
Peckham, equity trading strategist at Jefferies & Co in New
York.
After the closing bell investors were hit by more
disappointing news when Research In Motion Ltd
<RIM.TO><RIMM.O>, maker of the BlackBerry device, posted
quarterly revenue below Wall Street forecasts, sending its
shares down 9.7 percent to $75 in after-hours trading. The
stock had ended in regular trading down 3.2 percent.
Stocks had risen early after data showed a fall in the
number of workers filing new claims for jobless benefits but
the gains were short-lived. []
Shares of natural resources companies were weighed down by
falling global commodity prices as the U.S. dollar rose. U.S.
front-month crude <CLc1> fell 4.5 percent, or $3.08, to settle
at $65.89 a barrel on the New York Mercantile Exchange.
Spot gold prices <XAU=> fell below $1,000 an ounce.
Caterpillar Inc <CAT.N> , which makes bulldozers and
excavators, was the top drag on the Dow, falling 2.4 percent to
$51.85, while Chevron Corp <CVX.N> shares fell nearly 1 percent
to $70.71.
The S&P energy index <.GSPE> was down 1.3 percent, while
the S&P materials index <.GSPM> dropped 2 percent.
Among financials, JPMorgan <JPM.N> dropped 1.5 percent to
$44.37, while the KBW bank index <.BKX> declined 2.1 percent.
On Nasdaq, Electronic Arts <ERTS.O> shares fell 2.7 percent
to $19.29 after a Microsoft <MSFT.O> executive said the
software company had no plans to buy the video game publisher.
[]
(Editing by Kenneth Barry)
