U.S. Stocks Decline for 7th Time in 8 Days; Home Depot Retreats By Eric Martin http://www.bloomberg.com/apps/news?pid=20601087&sid=a23Nd5AOEtRE&refer=home March 2 (Bloomberg) -- U.S. stocks fell as a Federal Reserve official acknowledged there ``could be'' a recession and Dresdner Kleinwort, the top-ranked strategy team in the world, said this week's global equity selloff isn't over. Home Depot Inc., the world's biggest home-improvement retailer, retreated for a 12th day as data this week showed new- home sales declined the most in a decade. Stocks are headed for their worst weekly losses since September 2003 after a plunge in Chinese shares helped spark a worldwide rout. Slowing profit growth, a rise in mortgage delinquencies and signs that U.S. manufacturing is contracting have heightened concern the economy may contract. Both the Standard & Poor's 500 Index and Dow Jones Industrial Average declined for a seventh time in eight days, erasing their year-to-date gains. ``Stock prices cannot go up indefinitely,'' said Matthew Kaufler, who helps manage $2.6 billion at Clover Capital Management in Rochester, New York. ``You need to wring a little of the excess out from time to time. It wouldn't surprise me at all that sometime here in 2007 we have a pullback of 10 percent to 20 percent.'' The S&P 500 dropped 4.21, or 0.3 percent, to 1398.96 as of 9:48 a.m. in New York. The Dow average declined 25.47, or 0.2 percent, to 12,208.87. The Nasdaq Composite Index fell 7.02, or 0.3 percent, to 2397.19. Stocks also declined before a report that may show consumer sentiment fell in February as fuel prices rose. An increase in jobless claims yesterday helped reinforce investors' concerns that economic growth may be slowing. Recession? St. Louis Fed Bank President William Poole today said while there ``could be'' a recession, the central bank doesn't forecast one and the consensus estimate is for growth above 2.5 percent in the coming year. So far this week, the S&P 500 has fallen 3.5 percent, the Dow has lost 3.5 percent, while the Nasdaq has dropped 4.7 percent. Investors should cut their equity holdings and buy government bonds because the current selloff isn't over, according to Dresdner Kleinwort. ``The long and widely awaited equity correction is upon us,'' wrote London-based Albert Edwards, a strategist at Dresdner, in a note today. ``We are shifting our asset allocation stance to become much more aggressively underweight equities.'' Home Depot fell 26 cents to $39.19, bringing its 12-day retreat to 6.2 percent. The government this week said new-home tumbled in January by the most in 13 years and fourth-quarter economic growth was less than previously estimated, dousing speculation that the worst of the slowdown is over.