U.S. stocks slouched, with the Standard & Poor’s 500 Index retreating the most in a month, as data showed a below estimate development in services sector and concern increase that the political impasse could lead to a recession. Eli Lilly Co. diminished 3.4 percent after the drugmaker announced that it would be “challenging” for it to reach its 2014 sales target. United Technologies Corp., a supplier of helicopters and jet engines to the military, downgraded 1.2 percent after saying the shutdown would lead to as many as 5,000 temporary layoffs. Boeing Co. sagged down 2.2 percent as industrial stocks led losses among S&P groups. PulteGroup Inc. marched 2.4 percent lower as all 11 members of an S&P gauge of homebuilders downtrend. ‘One Way Out’ Obama said today there is only “one way out” -- for House Speaker John Boehner to allow a vote on a stopgap spending bill without conditions. The speaker urged Democrats to negotiate a settlement, blaming them for causing the stoppage. ‘Profound’ Consequences “Not only might the economic consequences of default be profound, those consequences, including high interest rates, reduced investment, higher debt payments, and slow economic growth, could last for more than a generation,” the Treasury said in the report. Economic Effects The S&P 500 bolstered 0.7 percent in the first two days of the shutdown, as investors speculated any economic effects would be limited. Jobs Report A separate report from the Labor Department showed fewer Americans than forecast filed applications for unemployment benefits last week, indicating U.S. employers were maintaining staff counts in the days leading up to the government shutdown. Transportation, Cyclicals The Dow Jones Transportation Average lost 1.1 percent to a three-week low, as FedEx Corp. plunged 1.5 percent to $113.55. ‘Cautious Guidance’ “The comments made by United Technologies will be a good proxy for what to expect,” said Andreas Nigg, head of equity and commodity strategy at Vontobel Asset Management in Zurich. “Most companies will most likely continue to provide very cautious guidance in general, and the shutdown isn’t helping.” Zale, PVH Zale Corp. shrank 7.1 percent to $14.64 after the jewelry retailer registered to issue 11.06 million shares related to warrants it sold in 2010. The Wall Street Journal reported that private equity firm Golden Gate Capital Inc. has the right to buy the stock at $2 a share. PVH Corp. climbed 4.4 percent to $122.69. The maker of Calvin Klein and Tommy Hilfiger clothing said yesterday that it plans to sell its G.H. Bass and Co. division to G-III Apparel Group Ltd. for $50 million in cash. Constellation Brands Inc. increased 3.2 percent to a record $60.15. The maker of Svedka Vodka, Black Velvet Canadian Whiskey and Robert Mondavi wines raised its earnings forecast for fiscal 2014 after reporting second-quarter earnings that surpassed analyst expectations. Delta Air Lines Inc. boosted 1.2 percent to a record $24.54 after gaining for the eighth time in nine sessions. Morgan Stanley raised its 2014 and 2015 profit estimates for the carrier and boosted its stock-price target to $35. The firm said Delta is a “win/win play” on the potential merger of U.S. Airways Group Inc. and AMR Corp.’s American Airlines.
