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Stocks Close Little Changed

From Times Wire Services

U.S. stocks ended mixed Wednesday, as key indexes rallied from a modest early sell-off to close little changed.

A disappointing forecast from jet maker Boeing offset stronger-than-expected results from General Motors and gains in the energy sector.

On Nasdaq, shares of Internet retailer Amazon.com plunged 22% to a three-year low, a day after the company cut its earnings outlook.

In the Treasury bond market, yields declined after the Federal Reserve’s “beige book” report on regional economic trends pointed to a further slowdown in the economy.

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Worries about the economy may have given some stock investors pause, after two days of rising share prices, analysts said.

Brian Bush, director of equity research at brokerage Stephens Inc., said some disappointing second-quarter earnings reports in recent days have made it “clear that earnings growth is going to slow in the second half of the year. The question is to what degree.”

The Dow Jones industrials dropped 1.20 points to end at 11,102.51, after rallying a total of 235 points the previous two days.

The Standard & Poor’s 500 index inched down 0.48 of a point to 1,268.40. The Nasdaq composite index slipped 3.44 points, or 0.2%, to 2,070.46.

Winners narrowly outnumbered losers on the New York Stock Exchange, while losers had the edge on Nasdaq.

Stocks were slightly higher for part of the afternoon after the release of the beige book, but the rally faded by the closing bell.

In the bond market, , yields dropped as some investors bet that a weaker economy raises the odds that the Fed will halt its credit-tightening campaign.

Fed policymakers will meet Aug. 8.

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The 10-year Treasury note yield fell to 5.03% from 5.06% on Tuesday.

The yield has dropped from 5.24% on June 28.

The 2-year T-note ended at 5.05%, down from 5.11% on Tuesday.

Among the day’s market highlights:

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* Boeing was the biggest drag on the Dow index after the aircraft maker raised its 2007 profit outlook less than some analysts had expected. The stock slid $3.85 to $79.90.

* GM jumped $1.34 to $32 after the auto giant posted surprisingly strong quarterly operating earnings. The stock is up 65% this year as the company’s recovery plan has gained steam.

* Amazon.com plummeted $7.33 to $26.26, its lowest price since 2003. The company late Tuesday warned that 2006 earnings would be below expectations, in part because of higher costs.

Also in the Internet sector, EBay lost 23 cents to $24.43 and Google dipped $3.86 to $385.50.

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* Energy stocks were broadly higher on optimism about earnings. ConocoPhillips, which reported a 65% jump in quarterly profit, gained $1.15 to $68.60.

Exxon Mobil, which reports results today, rose 86 cents to a record $66.60. The stock is up 19% this year, compared with a 1.6% rise for the S&P; 500 index.

Near-term crude futures added 19 cents to $73.94 a barrel in New York.

* Retail stocks were lower on worries about consumer spending. J.C. Penney fell $1.72 to $61.94 and Kohl’s lost $1.46 to $54.36.

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* The Dow transportation index continued to slide, hurt by Norfolk Southern’s weaker-than-expected earnings report. Norfolk Southern slid $3.85 to $41.40. The Dow transports index gave up 2.8% to 4,364.72, its lowest close since February.

* Countrywide Financial, the No. 1 U.S. mortgage lender, sank $2.05 to $36.90 despite reporting higher earnings on Tuesday.

* Mercury Interactive rocketed $10.75 to $49.75. Hewlett-Packard agreed Tuesday to buy the business-management software maker for $52 a share. Hewlett-Packard gained 42 cents to $31.75.

* Some newspaper stocks slid further. Gannett lost 45 cents to $52.12, a multi-year low, despite announcing a $1-billion stock buyback. Tribune, parent of The Times, fell 1 cent to $29.05.

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