S&P falls 2 percent as selloff accelerates

NEW YORK (Reuters) - U.S. stocks fell further on Wednesday and the S&P 500 briefly fell 2 percent, after disappointing new home sales data sparked worries about the strength of the economic recovery, prompting a sell-off. The financial sector led declines, and shares in the materials sectors were among the worst hit as the U.S. dollar rose 0.5 percent against a basket of currencies <.DXY> and sent commodity prices lower.

New home sales drop, durable goods orders up

WASHINGTON (Reuters) - Sales of new U.S. homes unexpectedly tumbled in September, their first drop in six months, underscoring the hazards to an economic recovery even as businesses appeared to be stepping up investment. New single-family home sales fell 3.6 percent to a 402,000 unit annual pace from a downwardly revised 417,000 units in August, the Commerce Department said on Wednesday. Analysts polled by Reuters had expected sales to rise to a 440,000 unit pace.

SEC search for ways to peer into fast trades

WASHINGTON (Reuters) - U.S. regulators are searching for ways to peer into the activities of high-frequency trading, which has blossomed in recent years and now accounts for at least 50 percent of all equity trading in the United States. At a congressional hearing to examine high-frequency trading and other market developments such as so-called "naked access" and "dark pools," the Securities and Exchange Commission said it seeking ways to secure better information about the fast traders.

Pay czar vows to rework AIG bonuses

WASHINGTON (Reuters) - Renegotiating bonuses to American International Group employees is a "top priority," the Obama administration's pay czar said on Wednesday, adding he believes he can do so without losing key employees. Kenneth Feinberg, the U.S. Treasury bailout program's "special master" for compensation practices, told U.S. lawmakers he will sit down with AIG and its Financial Products unit in January to renegotiate so-called guaranteed retention contracts.

Yahoo begins "journey back to respect": CEO

SAN FRANCISCO (Reuters) - Yahoo Inc <YHOO.O> said it has fixed various shortcomings that have plagued the Internet company in recent years and touted its large online audience and ties to advertisers as keys to its comeback. During a presentation to analysts on Wednesday, Chief Executive Carol Bartz said Yahoo had left many people confused about its purpose in recent years and disappointed by its lackluster financial performance.

Big U.S. companies balk at healthcare public option

WASHINGTON (Reuters) - Some of the nation's largest companies pushed back against U.S. Democrats' plans to deliver a government-run insurance option in a healthcare overhaul, decrying it as a step backward that would drive up costs for employers and their workers. The Business Roundtable, comprised of chief executives at Verizon Communications <VZ.N>, JPMorgan <JPM.N>, General Electric <GE.N>, Wal-Mart <WMT.N> and other companies that together employ more than 12 million people, said the federal government is inefficient and would underpay providers. That would result in providers boosting prices for private insurers and employers, the group said on Wednesday. Continued...