- USA TRADERS THREAD -

U.S. stocks close lower as inverted curve unnerves investors ($INDU, $COMPQ, $SPX, $TNX) By Tomi Kilgore
NEW YORK (MarketWatch) -- U.S. stocks closed lower Thursday, erasing early gains, as a late inversion in the Treasury yield curve unnerved investors, and offset better-than-expected reading of manufacturing activity in the Chicago region and a sharp rebound in General Motors shares. The Dow industrials ($INDU) fell 11 points to an official close of 10,785, after being up as much as 29 points at its intraday high. Dow component General Motors (GM) fell as much as 1.5% in intraday trade to a 23-year low, but rebounded in midday trading to close up 2.2%. The Nasdaq Composite ($COMPQ) had been up as much as 4 points in early trading, but closed with an 11-point loss at 2,218. The S&P 500 Index ($SPX) shed 4 points to 1,254. The yield curve, which was stable close to the flat line for most of the session, firmly inverted in the final hour of trading, with the yield on the 10-year Treasury note ($TNX) down to 4.368% vs. a 2-year yield of 4.381%. In the past, economic recession have usually followed inverted curves. In addition, November existing home sales fell 1.7% to a seasonally adjusted rate of 6.97 million, the lowest since March, while inventories of homes on the market rose 1.2% to 2.9 million, the most in nearly 20 years. Meanwhile, the Chicago purchasing managers index read 61.5 this month, near November's 61.7, but well above expectations of a decline to 60.4.