Stocks Opened Sharply Lower on Europe Woes, China

U.S. stocks opened sharply lower on Wednesday, extending the S&P 500’s losses into a sixth session, as worries about the euro zone crisis and weak data from China weighed on investor sentiment The Dow Jones Industrial Average lately fell 128.51 points to 11,365.21. The S&P 500 Index lost 13.95 points to 1,174.09. The Nasdaq Composite declined 27.52 points to 2,493.76.

American consumers barely increased their spending in October but their incomes rose by the most in seven months. The rise in take-home pay could boost spending during the upcoming holiday shopping season. The Commerce Department said Wednesday that spending increased 0.1 percent last month, the poorest gain in four months. But incomes increased 0.4 percent, the best showing since March.

China’s factory sector shrank the most in 32 months in November on signs of domestic economic weakness, a preliminary PMI survey showed. The steep fall in the HSBC flash purchasing managers’ index (NYSE:PMI) to 48 in November from 51 in October largely reflected domestic weakness as both output and new orders shrank even as export orders continued to grow.

Any hopes that the 17-country eurozone will avoid sliding back into recession in the wake of a debt crisis that’s shown alarming signs of spreading to the bigger economies appeared to have been dashed Wednesday. A couple of indicators show that the eurozone economy is in deep trouble and that the debt crisis is denting confidence so badly that a recession looks almost inevitable. Figures last week showed that the eurozone only narrowly avoided contracting in the third quarter, growing by only 0.2 percent during the period.

A “disastrous” sale of German benchmark bonds sparked fears on Wednesday the debt crisis was beginning to threaten even Berlin, with the Bundesbank forced to dig deep into its pockets to ensure the auction did not fail.

Deere & Co. says strong sales of its farm equipment helped boost its fourth-quarter profit by 46 percent and says it expects robust demand will lead to better results next year better. The company said Wednesday that equipment sales were up 20 percent in the quarter. That helped Deere generate net income of $670 million, or $1.62 per share, for the three months ended Oct. 31, up from $457 million, or $1.07 per share, a year ago. Revenue grew 20 percent to $8.6 billion from $7.2 billion a year ago.