Stocks drop slightly as traders seek clues
NEW YORK » Stocks fell slightly but showed more signs of stability yesterday as investors sifted through new economic data and found little reason to resume last week's heavy selling pace.
The stock indexes wavered in a narrow range, reacting little to comments from Chicago Fed President Michael Mos-kow that inflation remains stubborn and that interest rate increases might be needed to contain costs. The stock market was similarly unimpressed by data showing a weaker jobs picture and sluggishness in some areas of the country.
Investors in the past week have harbored concerns about a global economic slowdown and have been looking at data to try to determine whether the U.S. economy is still capable of pulling off a soft landing.
In late trading, stocks turned lower after drifting higher for most of the afternoon, unable to build on the rally of a day earlier.
Tuesday's advance was strong -- the Dow Jones industrials made up about 26 percent of the losses they suffered in the previous week -- but it left investors wondering whether renewed volatility would subside long enough to allow Wall Street to build some consensus about where stocks were headed.
Overall, though, yesterday's trading was reassuring. Volume levels were more typical of everyday trading than the big numbers Wall Street posted for much of the last week.
"The market is stabilizing after the storm of last week. That's real progress. It's extremely welcome. It allows us to restore investor confidence," said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors.
The Dow Jones industrial average fell 15.14, or 0.12 percent, to 12,192.45. The Dow traded within a 78-point range yesterday, a much narrower band than in recent sessions.
Broader stock indicators also edged lower. The Standard & Poor's 500 index fell 3.44, or 0.25 percent, to 1,391.97, and the Nasdaq composite index declined 10.50, or 0.44 percent, to 2,374.64.
The Russell 2000 index of smaller companies fell 2.98, or 0.38 percent, to 775.90.
Advancing issues and decliners were virtually equal on the New York Stock Exchange, where volume came to 3.10 billion shares, down from 3.29 billion shares Tuesday.
Bonds got a lift from the Federal Reserve survey, which said most parts of the country saw modest economic growth in the past month, but many areas saw slowing. The yield on the benchmark 10-year Treasury note fell to 4.50 percent from 4.53 percent late Tuesday.
The dollar was mixed against other currencies, while gold prices rose.
Light, sweet crude rose $1.13 to settle at $61.82 a barrel on the New York Mercantile Exchange after weekly domestic inventory data showed a surprise draw on stocks.
The energy market rally drove up stocks of oil companies; Chevron Corp. rose 66 cents to $68.33; Exxon Mobil Corp. rose 64 cents to $71.64; and ConocoPhillips climbed $1.34, or 2 percent, to $67.16.