Stocks finish flat after lackluster BoA results
NEW YORK » Wall Street pared its losses to finish flat yesterday but remained uneasy after disappointing results from Bank of America Corp. provided further evidence that the credit crisis is hurting the economy.
The Dow Jones industrial average, which fell as much as 60 points early in the session, rebounded as bargain hunters entered the market.
Still, investors remained spooked after BofA -- considered a bellwether for the banking industry because it has branches across the country -- said "significant dislocations" in the capital markets sent third-quarter profits down 32 percent. Citigroup Inc. and Washington Mutual Inc. reported similar results in recent days.
Treasurys rallied and the dollar fell to a new low against the euro after the U.S. Labor Department said the number of newly laid off workers filing claims for unemployment benefits shot up last week by the largest amount since February.
The report was far worse than economists expected, and signaled that the labor market could be starting to weaken from a downturn in housing and the global credit turmoil.
"There are so many factors going on right now between the dollar getting crushed, oil moving higher, and news out of the banking sector," said Greg Church, chief investment officer of Church Capital Management. "Yet, it is amazing to me that this market continues to lift its head. The market came back somewhat because there's that whole camp that thinks any bad news is good news that the Fed will lower rates."
The Dow fell 3.58, or 0.03 percent, to 13,888.96.
Broader indexes finished mixed. The Standard & Poor's index fell 1.16, or 0.08 percent, to 1,540.08, while the Nasdaq composite index added 6.64, or 0.24 percent, to 2,799.31.
The Russell 2000 index of smaller companies edged up 0.14, or 0.02 percent, to 825.03.
Declining issues led advancers by a thin margin on the New York Stock Exchange, where volume came to 1.27 billion shares compared with 1.42 billion traded Wednesday.
The yield on the benchmark 10-year Treasury note, which moves inversely to prices, fell to 4.51 percent from 4.55 percent late Wednesday. Treasury prices rose again after rallying sharply Wednesday amid growing signs of trouble in the housing sector.
Oil prices continued their advance due to further tensions between Turkey and Kurdish rebels in Northern Iraq. Light, sweet crude rose $2.07 to settle at a record $89.47 a barrel on the New York Mercantile Exchange.
Disappointing results from BofA made the market wary about other upcoming earnings reports.
But technology shares could see a boost today. After yesterday's closing bell, Google posted a 46 percent jump in its third-quarter profit, topping the big expectations that have elevated the Internet search leader's stock price by more $100 during the past month. Google ended the regular session up $6.14 at $639.62.
Bank of America fell $1.18, or 2.4 percent, to $48.85. Washington Mutual tumbled $2.55, or 7.7 percent, to $30.52 after it reported quarterly profit plunged 72 percent. The stock hit a 52-week low of $30.