Stocks End Mixed Amid Earnings Wave
Wall Street continued to struggle to find direction on Thursday amid mixed second-quarter earnings reports and uncertain economic data.
Companies including Apple Computer rallied on earnings news, while drug giant Pfizer slid after issuing a downbeat forecast for the year.
Given the mixed signals, “Nobody’s worried that the market’s about to cave, but there’s no catalyst for the upside either,” said Matt Kelmon, portfolio manager of the Kelmoore Strategy Funds.
The Dow Jones industrial average fell 45.64 points, or 0.4%, to 10,163.16, its lowest close since May 26.
The Standard & Poor’s 500 index also ended at an eight-week low, off 4.78 points, or 0.4%, at 1,106.69.
The technology-dominated Nasdaq composite index slipped 2.17 points, or 0.1%, to 1,912.71, its fourth straight loss and the lowest close since May 21.
But advancing issues outnumbered decliners by about 5 to 4 on the New York Stock Exchange, and winners and losers were almost evenly matched on Nasdaq.
Indexes of smaller stocks were mostly higher. The Russell 2,000 added 2.42 points, or 0.4%, to 562.15, its third gain in the five sessions.
Investors have been worried in recent weeks that the economy might be slowing considerably. The Federal Reserve said Thursday that industrial production dipped in June, and the Labor Department reported a drop in wholesale prices for the month, mainly because of lower energy and food costs.
Still, many economists expect business activity to be decent in the second half of the year.
Apple helped that sentiment with its report late Wednesday of strong results in the quarter ended June 26, and an encouraging forecast for the current quarter. The company’s shares surged $3.35 to $32.93.
By contrast, Pfizer -- one of the 30 Dow stocks -- slumped $1.43 to $32.58 after reducing its full-year sales forecast by about $1 billion, to $53 billion, because of lower revenue for some products and foreign currency fluctuations. Most other big drug stocks also closed lower.
“It’s an unforgiving climate right now,” Cummins Catherwood, who helps manage $750 million at Walnut Asset Management in Philadelphia, told Bloomberg News. “When you have a success, they yawn and give you a little pat on the back. When you have less than a success, they bang you on the head.”
Among Thursday’s market highlights:
* IBM eased 11 cents to $84.02 in regular trading before it reported quarterly earnings that beat estimates. The stock inched up to about $84.40 in after-hours trading.
Elsewhere in the tech sector, SanDisk soared $4.11, or 21%, to $24.09. The biggest maker of memory cards used in digital cameras said Wednesday that sales this quarter may exceed analysts’ estimates.
Advanced Micro Devices sank 77 cents to $12.97 after saying industry conditions made it tough to forecast demand.
* Nokia skidded $1.79 to $12.45 after saying that sales fell in the second quarter. The company warned that competition and dropping cellphone prices could hurt future profits.
* PepsiCo fell $1.49 to $51.92 after meeting analysts’ profit estimates but showing weakness in its Quaker brand products.
* Steel stocks continued to rally on optimism about the industry’s profit outlook. U.S. Steel rose 67 cents to $37.40, its fifth straight gain.
Other steel winners included Nucor, up 78 cents to $78.93, and Olympic Steel, up 68 cents to $20.09.
* General Electric rose 24 cents to $33.37, its seventh gain in eight sessions. The company last week described the economy as “the best we’ve seen in years.”
* U.S. oil prices eased after hitting a six-week high Wednesday, as OPEC confirmed it would increase production quotas. New York light crude futures settled 20 cents lower at $40.77 a barrel.
* U.S. Treasury prices were flat ahead of today’s release of the June consumer price index. The yield on the benchmark 10-year note stood at 4.48%, the same as on Wednesday.
