Stocks mixed ahead of job report
Stocks ended mixed Thursday as investors traded cautiously in advance of the Labor Department’s reading today on December employment.
Shares of retailers and carmakers fell after a weakening job market and lower auto sales increased concern that consumer spending would slow.
Investors initially took some solace in findings released Thursday by payroll company Automatic Data Processing, which said the economy added 40,000 private-sector jobs last month, more than economists had expected.
Today’s report from the Labor Department should indicate whether last year’s solid job market can continue into 2008 and help sustain consumer spending.
Oil set a fresh trading record of $100.09 a barrel on the New York Mercantile Exchange after government figures showed a larger-than-expected decline in inventories. Crude futures closed at $99.18, down 44 cents.
Analysts said oil’s recent climb was stirring concerns about rising prices and whether they would leave the Federal Reserve room for further cuts in interest rates.
“We are worried about inflation,” said Nicholas Raich, director of equity research at National City Private Client Group in Cleveland. “That’s probably the biggest risk in 2008.”
A day after losing more than 220 points, the Dow Jones industrial average rose 12.76 points, or 0.1%, to 13,056.72.
The Standard & Poor’s 500 index was unchanged at 1,447.16 points, and the Nasdaq composite index slipped 6.95 points, or 0.3%, to 2,602.68.
The Russell 2,000 index of smaller companies fell 8.54 points, or 1.1%, to 745.01.
Advancing issues outnumbered decliners by about 8 to 7 on the New York Stock Exchange.
Bond yields fell. The benchmark 10-year Treasury note dropped to 3.89% from 3.91% late Wednesday. The dollar was mixed against other major currencies.
Gold rose to another 28-year high, climbing $9.40 to $866.40 an ounce in New York trading.
Stocks drew some support Thursday from a Commerce Department report on factory orders, which rose in November by the largest amount in four months. However, an important reading of business investment fell for a second straight month.
Also Thursday, the Labor Department said the number of laid-off workers signing up for unemployment benefits fell last week. But that reading can be volatile, and the latest one may have been skewed by factors related to the Christmas holiday.
Shares of Ford Motor and General Motors slid after the carmakers reported declines in December sales and issued downbeat comments about 2008. Ford fell 15 cents, or 2.3%, to $6.45. GM had the second-biggest decline in the Dow, sliding 49 cents, or 2%, to $23.92.
Among retailers, Walgreen and CVS Caremark sank after the drugstore chains reported lower-than-expected December sales. Walgreen dropped $2.28 to $35.06. CVS tumbled $2.58 to $36.77.
In other market highlights:
An index of home builders fell 4.2% to its lowest level in a month. Lennar, the largest U.S. builder, lost 48 cents to $16.72. No. 2 Pulte Homes slid 64 cents to $9.78.
Monsanto rose $9.45, or 8.5%, to $120.92 after saying fiscal first-quarter earnings tripled, surpassing expectations, thanks to healthy sales of its Roundup herbicide and a strong performance by its Latin American business.
Monsanto led a gauge of raw-material producers to a 1.5% gain, the steepest among 10 industries in the S&P; 500.
Gold producer Newmont Mining jumped $1.42 to $53.81 on the precious metal’s continued advance.
State Street surged $6.49 to $85.37. Excluding a $279-million charge after taxes, the financial services company’s fiscal 2007 profit outlook topped analysts’ expectations.
Panera Bread tumbled $3.26 to $31.52. The company said bad weather caused December and fourth-quarter same-store sales to come in below what most Wall Street analysts expected.
Job-listing provider Monster Worldwide sank $2.70 to $28.93. A drop in the company’s employment index suggested sluggishness in U.S. online recruitment.
Overseas, key stock indexes rose 1% in Britain and 2.4% in Hong Kong. Shares fell 0.5% in Germany and 0.1% in France. Markets in Japan were closed for a bank holiday.
