Dow sets another record
The Dow Jones industrial average pushed above the 14,000-point level for the first time Tuesday after a mostly tame inflation reading gave investors reason to extend Wall Street’s persistent rally.
The stock market’s best-known indicator crossed the milestone in the first half-hour of trading, though it didn’t close above that level; it did, however, manage its fourth record close in as many sessions. The Dow rose as high as 14,021.95 only 57 trading days after crossing 13,000. Broader stock indexes, however, finished mixed.
Stocks have risen fairly steadily since the spring amid a wave of corporate takeovers and evidence that consumers are still spending and corporate earnings are still growing despite higher fuel prices and problems in the housing and mortgage sectors. With the Federal Reserve ever vigilant about inflation, any news of prices rising at a moderate pace has added to the market’s momentum because such reports calm fears of Fed action to raise interest rates.
The release Tuesday of generally upbeat earnings reports helped reassure investors who had worried that a slowing economy could cut into corporate profits.
The Dow rose 20.57 points, or 0.1%, to close at 13,971.55.
Broader stock indicators ended mixed. The Standard & Poor’s 500 index edged down 0.15 of a point to 1,549.37 after a series of record highs in recent sessions. The Nasdaq composite index rose 14.96, or 0.6%, to 2,712.29.
Declining issues outnumbered advancers by about 3 to 2 on the New York Stock Exchange.
Bond yields rose, with the benchmark 10-year Treasury note’s yield rising to 5.06% from 5.04% late Monday. The dollar was mixed against other major currencies, while gold prices fell.
Oil futures edged down 13 cents to $74.02 a barrel on the New York Mercantile Exchange after trading as high as $75.35. Oil hasn’t closed above $75 since August 2006.
The Dow’s run from 13,000 to 14,000 over the last three months was led by big names in heavy industry, with diversified manufacturer 3M, construction-equipment maker Caterpillar, aluminum producer Alcoa and energy giant Exxon Mobil among the biggest contributors. JP Morgan Chase and Johnson & Johnson were laggards.
Tuesday’s ascent came as Wall Street sorted through a somewhat mixed inflation reading and profit reports from blue-chip names including Coca-Cola, which reported that second-quarter sales jumped 19% but that case volume in North America slipped 2%. Coke stock fell 68 cents to $53.17.
Wholesale prices fell unexpectedly in June, the Labor Department reported Tuesday, but so-called core producer prices, which exclude often-volatile food and energy costs, rose more than expected. Wall Street, however, appeared unfazed by the core reading because it largely stemmed from higher vehicle prices.
In after-hours trading, shares of Intel and Yahoo sank after the companies’ earnings reports spurred concern that profit forecasts for tech firms were too high. Intel slid to $25.05, down $1.28, or 4.9%, from Tuesday’s regular-session close of $26.33. Yahoo lost $1.13, or 4.1%, to $26.40, down from $27.53 at the end of regular trading.
In other market highlights:
* Johnson & Johnson fell $1.06 to $62.74. The health-product maker lowered its 2007 revenue forecast, citing reduced prospects for U.S. sales of its Cypher heart stent and anemia drug Procrit, both tied to heart attacks in studies.
* Lyondell Chemical soared $6.93, or 17%, to $47.05 after Dutch chemical company Basell agreed to acquire its U.S. rival for $12.1 billion in cash.
* Rohm & Haas jumped $5.54 to $61.27. The paint and chemical maker announced plans to repurchase $2 billion in stock.
* Nautilus plunged $2.04 to $9.90 after the fitness-equipment maker reported weak second-quarter earnings and an analyst said results might not improve in the second half of the year.
* Encysive Pharmaceuticals soared 33 cents, or 19%, to $2.03 after the biopharmaceutical company indicated it might put itself up for sale.
* Assurant plunged $5.85, or 10%, to $52.95. The mobile-home insurer put three top executives, including its chief executive, on leave after securities regulators said they might sanction them in an accounting probe.
* Overseas, key stock indexes fell 0.6% in Britain, 0.8% in Germany, 0.4% in France and 0.1% in Japan.
