Stocks Finish Mostly Lower, Pre-Greenspan
The U.S. stock market ended broadly lower on Monday as traders awaited Federal Reserve Chairman Alan Greenspan’s testimony before Congress today.
Meanwhile, Mexican stocks were hit by heavy profit-taking.
On Wall Street, most key indexes finished with moderate losses, led by the Nasdaq composite, which sank 11.76 points, or 0.8%, to 1,536.23 as some major tech shares declined.
Among major indexes, only the Dow Jones industrials edged higher, adding 16.26 points to 7,906.72 after diving 130 points Friday.
In the broad market, losers swamped winners by nearly 2 to 1 on the New York Stock Exchange.
“I think people are kind of resting before the next wave,” said James Volk, trader at Jensen Securities.
Stocks have surged in recent weeks as bond yields have fallen to seven-month lows and as many companies have reported strong second-quarter earnings.
On Monday, IBM joined the list of companies reporting better-than-expected results. Its earnings were released after markets closed.
Today, Wall Street will be weighing comments from Greenspan on the direction of the economy, interest rates or the stock market itself. The central bank chairman will deliver his semiannual testimony to Congress today and Wednesday.
Analysts said they expect the Fed chief to say the central bank needs to be wary of inflation, despite recent economic data showing muted price rises.
“The market will likely be on hold on the downside until we get through Greenspan,” said Richard Cripps, chief market strategist at Legg Mason Wood Walker.
Bond traders were fairly sanguine Monday, ahead of Greenspan. The yield on the 30-year Treasury bond edged up to 6.54% from 6.53% on Friday.
Among Monday’s highlights:
* Stocks moving on earnings news included Boeing, down $1.69 to $54.38; Kimberly-Clark, down $4.31 to $47.31; Exxon, up 88 cents to $61.31; and Union Carbide, up $1.75 to $52.
* Blue-chip gainers helping the Dow included Caterpillar, up $2.38 to $56.75, and AlliedSignal, up $2.13 to $90.88.
* Among tech issues, Microsoft led the group lower, down $4.56 to $135.94. Other losers included Motorola, down $3.13 to $78.88, and Oracle, off 69 cents to $55.19.
In foreign trading, the Mexican market’s key stock index tumbled 130.34 points, or 2.8%, to 4,590.22 amid concerns about second-quarter earnings.
But Brazilian shares ended higher after their recent battering.
In currency trading, the dollar reached 116.15 Japanese yen, up from 115.57 on Friday and its first close above 116 yen since June 4.
Japanese financial markets were closed for a holiday.
*
Market Roundup, D12
