Stocks Break Losing Streak
Stocks broke a losing streak to rise slightly Thursday as investors sought the relative safety of consumer and industrial stocks after firms in the drug and software sectors warned quarterly profits will miss forecasts.
An upbeat profit forecast by Dell Computer lifted Dell’s stock 56 cents to $26.75 and helped some computer hardware-related issues.
But that optimism was offset by warnings of disappointing profits from drug giant Bristol-Myers Squibb and security software maker Check Point Software.
And fears about escalating violence in the Middle East held the market’s gains in check.
The Dow industrials rose 36.88 points, or 0.4%, to 10,235.17, breaking a four-session losing streak. The Standard & Poor’s 500 index inched up 0.1% to 1,126.34. The Nasdaq composite index gained 5.40 points, or 0.3%, to 1,789.75.
Advancing stocks led decliners by about 9 to 7 on the New York Stock Exchange; winners held a slim advantage on Nasdaq. Volume was moderate, but higher than it has been in recent days.
Bristol-Myers, the most-active stock on the NYSE, plunged $5.55, or 14.7%, to $32.15, after warning profit will suffer because of lower demand for its medicines.
Other drug makers’ shares also were dragged down, including Pfizer, which lost $1 to $39. The Amex pharmaceutical index fell 2.4% to its lowest since September.
Check Point, the third most-active Nasdaq issue, dropped $5.39, or 19.6%, to $22.07 after saying first-quarter revenue and profit will miss estimates.
Among other stocks that were slammed on new earnings warnings were SonicWall, a computer security company, which lost $2.54, or 25%, to $7.54, and InFocus, a video projection maker, which lost $3.25, or 18.8%, to $14.
As those shares slumped, buyers turned to some consumer-related issues. Home Depot rose $1.20 to $48.15, Hot Topic gained $2.19 to $23, Avon Products added $1.34 to $55.85 and Kellogg jumped $2.11 to $34.86.
Oil prices slipped after President Bush called on Israel to begin withdrawing from West Bank towns, raising hopes of easing tensions in the Middle East and reducing the risk of an oil embargo.
On the New York Mercantile Exchange, May crude oil futures fell 98 cents to $26.58 a barrel, after touching a high of $28.35 earlier in the day.
“Tough talking from the White House contracted the war premium” on oil prices, said Peter Gignoux of investment bank Schroder Salomon Smith Barney.
Investors were spooked early in the day by a government report showing a spike in the number of Americans filing for first-time jobless benefits in the latest week.
This countered recent signs suggesting the U.S. economy was strengthening. Today the government will report key employment figures for March.
Among Thursday’s highlights:
* Stocks of energy companies followed oil lower, with the Philadelphia oil services index down 2.1%. Among the major oil companies, Exxon Mobil, a Dow stock, lost 54 cents to $43.15, and ChevronTexaco shed $2.21, to $87.79. Oil and gas producer Anadarko Petroleum fell $2.23 to $54.49, and Noble Drilling lost $1.11 to $39.85.
* GM, up 79 cents to $60.14, helped underpin the Dow. Merrill Lynch raised its second-quarter and full-year earnings estimates for GM, saying the auto maker’s production was running stronger than expected.
Other industrial issues gaining ground included Monsanto, up $1.30 to $32.76, and United Technologies, up 61 cents to $73.46.
* 3M rose $1.21 to $114.12. After the close of trading, 3M said its first-quarter profit will be at the high end of, or above, expectations.
Market Roundup, C5-6
