Blahs on Wall St. as holiday begins
Stocks finished mostly lower Friday as lackluster economic reports offered Wall Street little incentive to place big bets before a long weekend.
Disappointing data on manufacturing, consumer confidence and import prices reminded investors that the economy was struggling.
“The fear factor still sits in the minds of investors,” said Bill Schultz, chief investment officer at McQueen, Ball & Associates in Bethlehem, Pa. “We just can’t get over that hurdle.”
The Dow Jones industrial average fell 28.77 points, or 0.2%, to 12,348.21. The blue-chip index ended the week with a gain of 1.4%.
A New York Federal Reserve survey on regional manufacturing indicated that conditions deteriorated this month, and the preliminary Reuters/University of Michigan survey on consumer sentiment for February showed a marked decline from the previous month. A Labor Department report found that import prices jumped in January on higher oil prices.
Friday’s market declines, though not severe, occurred a day after investors revealed their skittishness about the economy and sent stocks down more than 1%. The pullback, which came after strong gains earlier in the week, followed somewhat downcast remarks about the economy from Federal Reserve Chairman Ben S. Bernanke.
With stock markets closed Monday for the Presidents Day holiday and fresh economic concerns, investors appeared uninterested in making any sizable moves.
Broader stock indicators were mixed. The Standard & Poor’s 500 index edged up 1.13 points, or 0.1%, to 1,349.99 and finished the week with a 1.4% gain. The technology-heavy Nasdaq composite index fell 10.74 points, or 0.4%, to 2,321.80 to close the week with an advance of 0.7%.
The Russell 2,000 index of smaller companies fell 3.80 points, or 0.5%, to 701.52.
Declining issues outnumbered advancers by about 9 to 7 on the New York Stock Exchange.
For the week, the Dow and the S&P; 500 climbed 1.4%, the Nasdaq gained 0.7% and the Russell 2,000 rose 0.4%.
Yields on government bonds retreated after rising the first four days of the week. The yield on the benchmark 10-year Treasury note fell to 3.77% from 3.8% late Thursday. The dollar was mixed against other major currencies, and gold prices fell.
Oil futures edged up 4 cents to settle at $95.50 a barrel on the New York Mercantile Exchange.
Not all economic findings that arrived Friday portended further weakness but, overall, investors seemed unimpressed.
The Fed said that industrial output showed a modest increase last month, as expected, largely because of strength from utilities. But investors remain worried that consumers who are uneasy will be reluctant to open their wallets -- an alarming prospect because consumer spending accounts for more than two-thirds of economic activity.
“What’s dominating the market lately is the bad economic data that continues to confirm that the economy is slowing,” said Alexander Paris, economist at Chicago-based Barrington Research.
Though the country is not necessarily in a recession, more and more economists are coming to that conclusion, he said.
McQueen’s Schultz predicted that volatility would persist on Wall Street as investors tried to sort through their concerns about the financial sector.
The uncertainty lapping at Wall Street is attributable in part to the opaque nature of sub-prime mortgage debt. Many of those loans, which are now going bad, were bundled and sold as exotic debt securities whose worth is difficult to determine.
The concerns about faltering debt have stoked worries about the solvency of bond insurers and sent some borrowing costs higher, disturbing normally staid parts of the financial sector that help pedal the economy.
In other market highlights:
* Priceline.com jumped $21.63, or 21%, to $123.86. The online travel company said its fourth-quarter earnings more than doubled on a 62% increase in gross travel bookings.
* Brocade Communications Systems tumbled 88 cents, or 13%, to $7.65. Fiscal first-quarter profit fell on higher costs, but the data networking technology company backed its full-year profit and revenue forecast.
* Kraft Foods jumped $2.02, or 6.9%, to $31.33 on word that billionaire investor Warren Buffett’s holding company took an 8.6% stake in the company.
* Campbell Soup surged $1.93, or 6.1%, to $33.44 after the company reported strong fourth-quarter sales of its ready-to-serve and lower-sodium soups.
* Consol Energy sank $4.80, or 6%, to $75.08 after Goldman Sachs downgraded the coal producer and said record prices and tight supply might not last much longer.
* Weight Watchers International rose $2.25, or 4.9%, to $48.17 after its fourth-quarter profit beat expectations.
* Chipotle Mexican Grill slid $3.40 to $105.25. The restaurant company’s fourth-quarter profit rose 62% but still fell short of expectations.
* Best Buy dropped $1.15 to $44.62 after the electronics retailer cut its profit outlook to below expectations because of poor sales in January.
* Overseas, key stock indexes slumped 1.6% in Britain, 1.9% in Germany and 1.8% in France. Share prices edged down in Japan.
