Stocks Slip on Worries About the Economy
Stocks ended slightly lower Thursday, weighed by losses in large telecommunications shares and weak economic data that renewed fears about the fragile economy.
The Dow Jones industrial average fell 44.68 points, or 0.5%, to 8,240.38. The Standard & Poor’s 500 index slid 4.45 points, or 0.5% to 876.45 and the Nasdaq composite index slipped less than a point to 1,396.58.
Losers beat winners by about 6 to 5 on the New York Stock Exchange and by a thin margin on Nasdaq. Trading was moderate.
Hopes that U.S. forces’ offensive against Baghdad may herald a quick end to the war in Iraq helped keep the market higher for most of the day.
But worries about the shaky U.S. economy resurfaced after a report showed that the services sector shrank unexpectedly in March, and a separate report showed a surprisingly big jump in jobless claims last week.
“The market has an amazing ability to ignore weak economic data,” said Keith Keenan, vice president of institutional trading at brokerage Wall Street Access. “The market’s also discounting an imminent victory with respect to war in Iraq.”
Hurting the blue-chip Dow was AT&T; and other telecom carriers, which fell after some Wall Street analysts scaled back their growth forecasts through 2004 and raised concerns about pension liabilities and competitive pressures.
AT&T; fell 94 cents to a new 52-week low of $14.95, SBC Communications dropped 47 cents to $21.68 and Verizon Communications fell $1.39 to $36.09.
Oil futures, after falling for two days, inched up 41 cents to $28.97 a barrel in New York trading, while gold dipped $4.70 an ounce to $324.90 -- its lowest since mid-December. Treasury bond yields were little changed.
In other highlights:
* Cerner, the leading provider of information technology to doctors and hospitals, sank $14.46, or 45%, to $17.63 after it said first-quarter earnings would fall short of analysts’ estimates.
* H&R; Block fell $4.32 to $40.03 after Goldman Sachs downgraded its stock a day after the largest U.S. tax preparer said its offices have handled fewer tax returns this year than they had in the prior-year period.
* Borders Group, the No. 2 U.S. bookseller, fell 40 cents to $14.30 after it said it would post a first-quarter loss rather than break-even as previously estimated, because consumers’ attention to the war has hurt sales.
* Companies warning that first-quarter profit would fall short included software firm Sybase and DNA chip technology company Affymetrix. Both issued their warnings after the close of regular trading. Sybase, down 33 cents to $12.73 in regular trading, fell to $12 in after-hours trading. Affymetrix, up 85 cents to $28 in regular trading, plunged to $18.30 after hours.
Market Roundup, C4-5
