Facebook stock continues its decline.

Stocks tumble after weak ISM's August manufacturing report shows contraction

--S&P 500 set for first close below 1400 in a month

--Facebook falls to fresh lows after Morgan Stanley and J.P. Morgan each cut price targets


By Chris Dieterich

NEW YORK--The Dow sank after a sluggish factory report fueled worries the economic recovery is losing momentum.

The Dow Jones Industrial Average dropped 62 points, or 0.5%, to 13028 in afternoon Tuesday trading. Dow briefly pushed below 13000 earlier, a level it's not closed below since early last month. The Standard & Poor's 500-stock index retreated four points, or 0.3%, to 1402, while the Nasdaq Composite Index lost two points, or 0.1%, to 3064.

Activity in the manufacturing sector slipped last month to its lowest level since July 2009, according to the Institute of Supply Management's purchasing manager's index. A separate report showed that spending on construction projects in July dropped the most in a year from the previous month.

'It's not falling off a cliff, but the economy continues to deteriorate,' said Gary Flam, portfolio manager at Bel Air Investment Advisors, noting weakness in Europe, China and Japan. 'You're getting continued deceleration, an economy that is running out of gas,' he said.
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