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Sep 28, 10:36 AM EDT

Weak report on consumer confidence sinks stocks


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NEW YORK (AP) -- Stocks slipped Tuesday following news that consumer confidence dropped to its lowest level since February.

The Conference Board said its September reading on consumer confidence fell sharply from August and was well below forecasts. Stocks have rallied throughout September as many major economic reports suggested that economic growth was slightly better than previously thought.

The Dow Jones industrial average fell about 8 points in morning trading, putting it in position to fall for the second straight day and fourth time in the past five days as a monthlong rally runs out of steam.

Stocks were already slightly lower early Tuesday before the disappointing report on consumer confidence. Traders are again weary of the health of Europe's financial markets and how countries there will be able to cope with mounting debt. There is growing speculation that Spain's credit rating could be slashed by Moody's Investors Service.

Dealmaking continued for a second straight day, but wasn't enough to overcome concerns about Europe's financial sector. Drug developer Endo Pharmaceuticals Holdings will buy Qualitest Pharmaceuticals for $1.2 billion.

In other corporate news, technology stocks were being dragged down as traders were disappointed Research in Motion Ltd. said it would not roll out its competitor to Apple Inc.'s iPad, called the PlayBook, until the beginning of 2011.

Drugstore chain Walgreen Co.'s profit easily topped forecasts, sending its shares sharply higher.

The Dow fell 7.83, or 0.1 percent, to 10,10,804.14 morning trading.

The Standard & Poor's 500 index fell 2.96, or 0.3 percent, to 1,139.20, while the Nasdaq composite index fell 10.06, or 0.4 percent, to 2,359.71.

Treasury prices rose after the weak report on consumer confidence, driving interest rates lower. The yield on the 10-year Treasury note, which is often used to set interest rates on loans, fell to 2.48 percent from 2.53 percent late Monday.

Endo Pharmaceuticals shares rose $2.77, or 9.1 percent, to $33.37.

Research in Motion shares fell $2.03, or 4.2 percent, to $46.32. Apple shares fell $7.42, or 2.6 percent, to $283.74.

Walgreen shares rose $2.64, or 8.7 percent, to $33.00.

Overseas, Germany's DAX index fell 0.9 percent, while France's CAC-40 dropped 1 percent. Britain's FTSE 100 fell 0.7 percent.

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