Equity markets slumped Friday on news that the European Central Bank’s top economist resigned, raising more fears about the debt crisis and undermining President Barack Obama’s $447 billion plan to revive the U.S. job market.
Footwear stocks, as usual, swung wilder than benchmark indices and closed the week with an average loss of 3.3 percent.
News of Juergen Stark’s resignation came shortly after the U.S. markets opened, and domestic stocks took cues from heavy losses in overseas markets hours earlier.
Stark, Germany’s top representative on the ECB’s executive board, elected to step down after last month opposing the bank’s extensive purchases of debt issued by heavily indebted member nations.
It didn’t help that the International Monetary Fund’s managing director, Christine Lagarde, warned ahead of this weekend’s G-7 summit in Marseilles, France, that the world economy is stepping into a “dangerous new phase,” and global leaders should be ready to consider “unconventional measures” to avert a more serious crisis.
All but one counter in a basket of 30 footwear stocks tracked by Footwear News fell Friday. Auri Inc. stayed flat, at 50 cents a share.
Shares of R.G. Barry Corp. were the biggest loser, shedding 6.8 percent. That was closely followed by Steven Madden Ltd., which slumped 6.4 percent.
Among the most resilient stocks were LaCrosse Footwear Inc., which slipped 1.5 percent; Foot Locker Inc., which lost 1.4 percent; and Big Five Sporting Goods Inc., which gave up 1.6 percent.
The Dow Jones Industrial Average closed down 303.68 points, or 2.7 percent, to 10,992.13. The Standard & Poor’s 500 shed 31.67 points, or 2.7 percent, to 1,154.23. The Nasdaq Composite dropped 61.15 points, or 2.4 percent, to 2,467.99.