Chilled mood leaves market mixed at close
NEW YORK » Wall Street turned in a mixed performance yesterday as Iran's refusal to suspend uranium enrichment rattled investors and tempered a tech rally spurred by a strong outlook from chip maker Analog Devices Inc.
Investors were uneasy after a U.N. official said Iran did not agree to Security Council demands to suspend its nuclear ambitions. Also hurting stocks was a U.S. government report that showed a larger-than-expected drop in gasoline and heating oil inventories, causing crude prices to bound above $60 a barrel.
This chilled the mood among investors who at first were encouraged by upbeat corporate announcements and a rally in foreign stock markets. Strength among semiconductor stocks drove the Nasdaq composite index to six-year highs.
Analog Devices, which gave an optimistic outlook about improving business conditions, drove chip stocks.
Investors were also encouraged about takeover activity this year as Whole Foods Market Inc. said it will buy rival Wild Oats Markets Inc. in a $565 million deal.
The Dow Jones industrial average fell 52.39, or 0.41 percent, to 12,686.02.
Broader stock indicators were mixed. The Standard & Poor's 500 index was down 1.25, or 0.09 percent, at 1,456.38.
The Nasdaq rose 6.52, or 0.26 percent, to 2,524.94; the tech-dominated index is at a six-year high and finished past the 2,524.31 half-way mark of its all-time high of 5,048.62 set on March 10, 2000.
The Russell 2000 index of smaller companies rose 2.11, or 0.26 percent, to 829.44.
Advancing issues outpaced decliners by a 3 to 2 basis on the New York Stock Exchange, as consolidated volume rose to 2.64 billion from 2.57 billion on Wednesday.
Overseas, Japan's Nikkei stock average closed up 1.09 per- cent, making its first foray above 18,000 in nearly seven years; investors were cheered by the Bank of Japan's decision to raise interest rates, indicating its confidence in the long-flagging Japanese economy. At the close, Britain's FTSE 100 was up 0.37 percent, Germany's DAX index was up 0.46 percent, and France's CAC-40 was up 0.23 percent.
The aftermath of Wednesday's stronger-than-expected consumer inflation figures from the government sent bond yields higher for the second day. The yield on the benchmark 10-year Treasury note rose to 4.73 percent from 4.70 percent Wednesday. The dollar was mixed against other major currencies, while gold prices fell.
Oil rose after the U.S. Energy Department reported increased demand for crude- based products. A barrel of light sweet crude rose to a seven-week high, up 88 cents at $60.95 on the New York Mercantile Exchange.