NEW YORK >> Divergent signals on the state of business left investors cautious and prices mixed on Wall Street today. Upbeat comments from Microsoft and Tiffany encouraged the market, but disappointing statements from Gateway, Ciena and AOL Time Warner limited stocks' ability to advance.
Wall Street mixed amid
varied company outlooks
By Amy Baldwin
Blue chips were weaker, falling back moderately after weeks of rallying, but tech shares managed modest gains.
As companies begin releasing fourth-quarter sales and earnings and some warn of weaker results, analysts said a pullback is to be expected with investors cashing in profits from recent rallies.
The Dow Jones industrial average closed down 46.50 at 10,150.55 after falling 62.69 yesterday to quash a three-session, 238-point winning streak.
"We have earnings season upon us and you are seeing some profit taking, but I don't think it is anything serious. ...The Dow hasn't shown any conviction on the downside," said Richard A. Dickson, a technical analyst for Hilliard Lyons in Louisville, Ky.
The Dow's slippage today was smaller than the 175 points it has gained so far in 2002. Additionally, the Dow has risen nearly 24 percent from its low following the Sept. 11 terror attacks.
The broader market was mixed today. The Nasdaq composite index rose 18.63 to 2,055.73, but the Standard & Poor's 500 index fell 4.18 to 1,160.71.
Decliners edged advancers 16 to 15 on the New York Stock Exchange, with 1,631 up, 1,522 down and 197 unchanged. Volume was 1.23 billion shares, below the 1.30 billion yesterday.
The NYSE composite index fell 3.44 to 589.71, the American Stock Exchange composite index slipped 1.13 to 836.20 and the Russell 2000 index rose 4.71 to 497.89.
The Treasury's 2-year note was unchanged at 100 12/32; its yield remained at 3.04 percent. The 10-year note fell 5/32 to 99 15/32; its yield rose 2 basis points to 5.07 percent. The 30-year bond fell 13/32 to 97 30/32; its yield gained 3 basis points to 5.52 percent.
Investors sold off the stocks of companies that reminded the market how tough business still is. Gateway slid 25 percent, down $2.56 at $7.69, on a fourth-quarter revenue warning.
Ciena fell $1.05 to $15.70 after Chief Executive Gary Smith was quoted by Dow Jones News Service as saying sales for the company, along with other telecom equipment makers, won't rebound in the first quarter.
"There is no clear sign of recovery," said Smith, speaking at a Salomon Smith Barney conference in Scottsdale, Ariz.
AOL Time Warner, which reduced its 2002 earnings forecast yesterday, stumbled 68 cents to $32.
While investors' increasing confidence in a healthier economy this year has boosted stocks, analysts say the market's upside will be limited until there are concrete signs of a turnaround.
"Things are definitely looking better. But people are getting very excited, very quickly, and that's when things can pull back," said Gary Kaltbaum, market technician for Investors' Edge Partners.
Overseas, stocks traded lower today with Japan's Nikkei stock average finishing the day down 2.3 percent. In Europe, France's CAC-40 closed down 1.0 percent.