Stocks fall on weak economic reports, Japan crisis

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By Associated Press

NEW YORK (AP) — Disappointing U.S. economic news and more worries about the nuclear crisis in Japan sent stocks lower Wednesday.

The Commerce Department reported that new home construction fell to the second-lowest level on record in February, reflecting weak demand. Homebuilder Lennar Corp. fell 3 percent, while Pulte Group Inc. and D.R. Horton Inc. each fell 2 percent.

Wholesale prices rose last month by the most in nearly two years due to higher energy costs and the biggest increase in food prices in 36 years. Shares of companies affected by higher food costs fell. McDonald's Corp. and Starbucks Corp. both fell 1 percent.

Japan temporarily suspended work at a stricken nuclear plant after a surge in radiation made it too dangerous for workers to remain at the facility. That came a day after Japan's prime minister said four crippled reactors at a nuclear power plant were leaking dangerous amounts of radiation.

The extent of the damage from the quake and the tsunami isn't yet known. Investors are concerned that the disaster could cause a slowdown in Japan's economy, the world's third-largest. Japan accounts for about 10 percent of U.S. exports.

The Dow Jones industrial average fell 61, or 0.5 percent, to 11,794 in early trading.

The Standard & Poor's 500 index fell 5, or 0.4 percent, to 1,277. The Nasdaq composite index fell 7, or 0.3 percent, to 2,661.

Nine of the 10 company groups in the S&P 500 fell. Energy stocks rose 0.4 percent after oil prices recovered.

Oil rose $1.53 to $98.71 a barrel. Natural gas prices rose about 2 percent. Financial analysts say natural gas is becoming more attractive as an energy source as governments around the world reconsider nuclear power in the aftermath of the Japan crisis.

Natural gas producers Cabot Oil & Gas Corp. and Chesapeake Energy Corp. both rose 3 percent.

Bond prices rose, sending yields lower. The yield on the 10-year Treasury note fell to 3.28 percent from 3.32 percent late Tuesday.