Wall Street sells off as Washington worries rise

By Caroline Valetkevitch

(Reuters) - U.S stocks sold off on Thursday, with the S&P 500 hitting its lowest level in a month, as escalating worries about the Trump administration's ability to push through its agenda rattled investors.

Stocks began to lose ground early in the session, following speculation of White House Economic Adviser Gary Cohn's possible departure.

A White House official later said Cohn intends to remain in his position, but after a short respite, the market continued to sell off and was at session lows in late afternoon trading.

The speculation came a day after Trump disbanded two business councils, with several chief executives quitting in protest over his remarks on white nationalists.

 

With valuation levels considered high, investors may be more prone to sell, said Stephen Massocca, senior vice president, Wedbush Securities in San Francisco.

"When you're at these valuations levels in a lot of these names, it doesn't take much. Anything can be an excuse," he said.

Investors also appeared to be losing faith in the administration's ability to move forward on its agenda.

"Continued problems with Republican leadership, inability to get anything done, and this latest wedge being driven between the president and Congress. Not helpful," he said.

Also weighing on the market, shares of Dow components Cisco System fell 4.5 percent a day after its results, while Wal-Mart was down 1.8 percent after the retailer reported a drop in margins due to continued price cuts and e-commerce investments.

The Dow Jones Industrial Average <.DJI> was down 212.04 points, or 0.96 percent, to 21,812.83, the S&P 500 <.SPX> lost 30.9 points, or 1.25 percent, to 2,437.21 and the Nasdaq Composite <.IXIC> dropped 106.54 points, or 1.68 percent, to 6,238.57.

The market also remained on edge after a van crashed into dozens of people in the centre of Barcelona on Thursday and Spanish media, citing police sources, said at least 13 people were killed. Police said the crash is being treated as a terror attack.

Declining issues outnumbered advancing ones on the NYSE by a 3.66-to-1 ratio; on Nasdaq, a 3.24-to-1 ratio favoured decliners.

The S&P 500 posted 49 new 52-week highs and 10 new lows; the Nasdaq Composite recorded 98 new highs and 85 new lows.

(Additional reporting by Sruthi Shankar and Tanya Agrawal in Bengaluru; Editing by Anil D'Silva and Nick Zieminski)