US STOCKS-Indexes down more than 1 pct after German move

* Global stocks fall after German market restrictions

* H-P tops estimate, raises outlook

* Dow off 1.2 pct, S&P off 1.2 pct, Nasdaq off 1.5 pct

* For up-to-the-minute market news see [STXNEWS/US]
(Updates to midday, changes byline)

By Caroline Valetkevitch

NEW YORK, May 19 (BestGrowthStock) – U.S. stocks (Read more about the stock market today. ) fell on Wednesday
as Germany’s decision to ban naked short-selling of certain
financial instruments fueled investor worries about exposure
to riskier assets and about the global economy.

Shares of industrial companies, which tend to rely heavily
on overseas sales, led losses. Caterpillar (CAT.N: ) was down
4.6 percent at $60.24, while shares of Boeing (BA.N: ) was down
3.2 percent at $65.57. Microsoft (MSFT.O: ), down 1.2 percent at
$28.27, was among the top drags on the Nasdaq.

“I think it’s all global response to the German move to
limit naked short selling. It signaled to investors another
step was needed to protect the euro,” said Fred Dickson, chief
market strategist at D.A. Davidson & Co., speaking from New
York. “It reflects there are continuing tensions.”

The S&P 500 briefly pierced 1,102.12, its 200-day moving
average, seen as a support level. A close below the level
could trigger more selling, analysts said. European stocks
also tumbled on Germany’s move, and hit their lowest closing
level in nearly two weeks, while Japan stocks also fell.

Germany banned naked short sales of euro-denominated
government bonds, credit default swaps based on those bonds
and shares of the country’s 10 leading financial institutions
in a move that appeared to catch its partners in the European
Union off guard. For details, see [ID:nSGE64I073]

The Dow Jones industrial average (.DJI: ) was down 122.81
points, or 1.17 percent, at 10,388.14. The Standard & Poor’s
500 Index (.SPX: ) was down 13.01 points, or 1.16 percent, at
1,107.79. The Nasdaq Composite Index (.IXIC: ) was down 34.95
points, or 1.51 percent, at 2,282.23, after earlier sliding 2
percent to a session low.

The U.S. stock market’s decline has left only the Nasdaq
in positive territory for the year.

In naked short selling, a trader sells a financial
instrument, betting that its price will fall, without first
borrowing the instrument or ensuring that it can be borrowed,
as in a conventional short sale.

German Chancellor Angela Merkel said in a speech to
parliament the euro was in danger, urging speedy action to
stop market “extortion,” and said the EU needed a process for
“orderly” insolvency of its members. [ID:nLDE64I0Z1]

Later Wednesday, the Federal Reserve’s policy-making
committee will release minutes from its most recent meeting.

On the upside were shares of Hewlett-Packard Co (HPQ.N: ).
H-P’s stock added 1 percent to $47.26 after the world’s
largest technology company by sales reported quarterly results
that beat expectations and raised its full-year earnings
outlook. [ID:nN18164132]

Money

(Reporting by Caroline Valetkevitch; Additional reportng by
Chuck Mikolajczak; Editing by Jan Paschal)

US STOCKS-Indexes down more than 1 pct after German move