Profit-taking sends US indices lower

US STOCKS fell yesterday as investors booked profits following a four-week rally that took the broad S&amp;P 500 index to a 10-month high on Friday.<br /><br />The drop comes ahead of an abundance of economic data due this week, including the Federal Reserve&rsquo;s statement on interest rates and the economy, as well as government figures for monthly retail sales.<br /><br />Materials companies&rsquo; stocks took a hit, with the S&amp;P materials index down 1.6 per cent as a rise in the US dollar curbed investors&rsquo; appetite for commodities priced in the greenback. <strong>AK Steel</strong> fell 4.7 per cent to $20.31 while <strong>Nucor</strong> lost 4.1 per cent to $47.10.<br /><br />&ldquo;A number of natural resource names were perhaps overextended. We are seeing a pullback in commodity-related stocks,&rdquo; said Joe Arsenio, president of Arsenio Capital Management. He said that there was also some profit taking after the market's steep rise in the past weeks.<br /><br />The Dow Jones industrial average lost 32.12 points, or 0.34 per cent, to close at 9,337.95. The Standard &amp; Poor&rsquo;s 500 Index fell 3.38 points, or 0.33 per cent, to 1,007.10. The Nasdaq Composite Index dropped 8.01 points, or 0.4 per cent, to 1,992.24.<br /><br />The retail group was a weak performer in the session, <strong>with Best</strong> Buy down 5.3 per cent at $37.66 after Goldman Sachs downgraded the electronics retailer to &ldquo;neutral&rdquo;.<br /><br />The S&amp;P Retail index dropped 2 per cent. On Nasdaq, <strong>BlackBerry</strong> maker <strong>Research in Motion</strong> was one of the top drags, down 4.9 per cent at $73.34. The stock was down for a third-straight session after UBS downgraded it to &ldquo;neutral&rdquo; from &ldquo;buy&rdquo; on concerns that Verizon Wireless, one of RIM&rsquo;s largest customers, may launch an iPhone.<br /><br />On the upside, <strong>McDonald&rsquo;s</strong> reported stronger-than-expected July sales, sending the Dow component&rsquo;s stock up 1.9 per cent to $56.27 on the New York Stock Exchange.<br /><br />Fellow Dow component <strong>Merck r</strong>ose 1.7 per cent to $30.60 after the pharmaceutial stock was reinstated by Goldman Sachs with a &ldquo;buy&rdquo; rating, and added to its Americas conviction buy list.<br /><br />The S&amp;P healthcare index gained 0.75 per cent.<br /><br />Volume was low on the NYSE, with 1.09bn shares changing hands, below last year&rsquo;s estimated daily average of 1.49bn. On the Nasdaq about 1.86bn shares traded, well below last year&rsquo;s daily average of 2.28bn.<br /><br />Declining stocks outnumbered advancing ones on the NYSE by a ratio of 8 to 7, while on the Nasdaq, about 14 stocks fell for every 13 that rose.