Nasdaq Ends Down 106; Dow Up 8
NEW YORK (AP) _ Stocks meandered to a mixed finish today as investors failed to find direction in a market facing rising interest rates and a dearth of significant economic news.
``The market is just marking time,″ said Alan Ackerman, senior vice president at Fahnestock & Co. in New York. ``We have buyers and sellers just waiting it out for the time being.″
The Dow Jones industrial average rose 7.54 to close at 10,777.28.
Broader stock indicators were mostly lower. The Nasdaq composite index fell 106.12 to 3,538.84.
The Standard & Poor’s 500 fell 10.59 to 1,437.21.
Declining issues outnumbered advancers by a 5-to-4 margin on the New York Stock Exchange, with 1,608 down, 1,284 up and 507 unchanged.
NYSE volume totaled 804.12 million shares as of 4 p.m., vs. 813.69 million in the previous session.
The Russell 2000 index of smaller companies fell 5.95 to 493.71.
The Nasdaq’s largest technology stocks led the index lower today. Cisco Systems, Oracle and Microsoft all declined.
Sprint and WorldCom both fell. The Wall Street Journal reported today that federal antitrust enforcers have recommended blocking WorldCom’s $115 billion buyout of Sprint because it would violate antitrust law.
Analysts said that while investors haven’t truly turned against technology stocks, there’s little interest in buying into the volatile sector while interest rates are rising.
``There’s a lot of cash out there, and yet we see only very selective buying,″ said Donald Berdine, chief investment officer at PNC Advisors. ``There’s very, very little conviction, and very few heroes to step up.″
Lycos rose. After the close of trading Wednesday, the company reported better-than-expected results for its fiscal third quarter. Analysts said investors were pleased with the earnings report, but remain wary of the stock due to concerns about the proposed takeover of Lycos by Spain’s Terra Networks SA.
The broader market was fairly quiet as investors continued to seek a new path in a market facing higher interest rates. The Federal Reserve raised interest rates for the sixth time since June on Tuesday, pushing the federal funds rate _ the interest that banks charge each other _ to 6.5 percent, the highest level in nine years.
Escalating borrowing costs make it tougher to borrow money to finance growth. Ultimately, that can cut into corporate profits.
``We have a lingering case of interest rate jitters,″ Ackerman said. ``There are not many who believe the Fed is near the end of its rate hikes.″
Still, financial stocks, which are vulnerable to interest rate fluctuations, were modestly higher today. J.P. Morgan, American Express and Merrill Lynch rose.
``People have said unilaterally that that they don’t want to own financial stocks while interest rates are moving higher,″ Berdine said. ``As a result, many of them are now very reasonably priced.″
Analysts noted that the market now faces a dry spell of major economic reports, with little to indicate whether the long series of rate increases are successfully slowing the economy.
Today, the Labor Department’s weekly jobless claims report showed that new claims for unemployment benefits fell last week for the second week in a row. That suggested that companies are still scrambling to find workers, leaving themselves vulnerable to pressure to bump up wages and benefits.
The next economic report with true potential to move markets is due May 25, when the Commerce Department issues its preliminary report on first-quarter gross domestic product.
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