That’s a record-breaking drop as a raw number, and major alcohol beverages stocks weren’t exempt. But, except for Diageo, the declines were less percentagewise than the 4.6% drop for the 30 blue-chip stocks that make up the Dow Jones Industrial Average.
Diageo’s ADRs fell 4.62%, Pernod Ricard’s ADR was down 2.76%, Constellation Brands was off 2.27%, Brown-Forman Class B was off 3.52%, Heineken was off 2.24% in Amsterdam. Anheuser-Busch InBev’s ADR was down 4.29%, Molson Coors was off 4.17%.
The Dow Industrials have fallen more than 8.5% from their last closing high on Jan. 26. That’s just 1.5 points away from the 10% mark that’s understood to represent a correction.
For the year, the blue-chip index of 30 leading industrial stocks is off 1.5%.
While a number of observers have felt the stock market was at a high based on fundamentals, traders said today’s drop appeared to be the result of algorithmic trading.
Meanwhile, in the broader economy, nothing has changed in the last five days, a point driven home by the Institute for Supply Management, which reports its NonManufacturing Index grew for the 96th consecutive month.
The NMI registered 59.9%, which is 3.9 percentage points higher than the seasonally adjusted December reading of 56%. This represents continued growth in the non-manufacturing sector at a faster rate.
The Non-Manufacturing Business Activity Index increased to 59.8%, 2 percentage points higher than the seasonally adjusted December reading of 57.8%, reflecting growth for the 102nd consecutive month, at a faster rate in January.
The New Orders Index registered 62.7%, 8.2 percentage points higher than the seasonally adjusted reading of 54.5% percent in December. The Employment Index increased 5.3 percentage points in January to 61.6% from the seasonally adjusted December reading of 56.3 percent.
The Prices Index increased 2 percentage points from the seasonally adjusted December reading of 59.9% to 61.9 percent, indicating that prices increased in January for the 23rd consecutive month.
The non-manufacturing sector reflected strong growth in January after two consecutive months of pullback. Overall, the majority of respondents’ comments are positive about business conditions and the economy. They also indicated that recent tax changes have had a positive impact on their respective businesses, ISM said.