Stocks finish mixed after uneven earnings
NEW YORK » Wall Street finished an erratic session mixed yesterday after an uneven batch of earnings reports made investors cautious about buying stocks. Disappointing economic readings added to the market's uneasiness a day after a big rally.
The market grew jittery after the Philadelphia Federal Reserve said regional manufacturing weakened further in April. The index of manufacturing activity fell to a negative 24.9 from a negative 17.4 in March. The survey found most manufacturing executives were "cautiously optimistic" about future activity, but a report of higher unemployment claims reinforced the market's recession worries.
Merrill Lynch & Co. reported a first-quarter loss of $2.14 billion, a shortfall that was wider than the average analyst estimate. The company also said it would eliminate 3,000 more jobs. However, Merrill Chief Executive John Thain said that business conditions in April appear better than in the first quarter. Merrill rose $1.82, or 4.1 percent, to $46.71.
Merrill's report followed a larger-than-anticipated rise in IBM Corp.'s quarterly earnings, but there were also disappointing results from Nokia Corp., the world's biggest mobile phone company, and drug maker Pfizer Inc.
Dan Laufenberg, chief eco-nomist for Ameriprise Financial, said the market remains cautious, though less so than in recent weeks and months.
"When you have nice moves like you had (Wednesday) and you hold onto most of that gain I think that tends to be a more positive signal," he said.
The Dow Jones industrial average was little changed, edging up 1.22, or 0.01 percent, to 12,620.49, after fluctuating throughout the session.
Broader stock indicators were mixed. The Standard & Poor's 500 index advanced 0.85, or 0.06 percent, to 1,365.56, while the Nasdaq composite index fell 8.28, or 0.35 percent, to 2,341.83. The Russell 2000 index of smaller companies fell 5.39, or 0.76 percent, to 708.00.
Advancing issues narrowly outnumbered decliners on the New York Stock Exchange, where consolidated volume came to 3.6 billion shares, compared with 4.1 billion traded Wednesday.
The quarterly reports that investors parsed yesterday were not auspicious. Nokia, the Helsinki-based cell phone maker, said its profit rose by a weaker-than-expected 25 percent. Its U.S. shares fell $4.74, or 14 percent, to $28.95.
Pfizer declined 70 cents, or 3.3 percent, to $20.40 following the company's report that its first-quarter profit fell 18 percent following competition from generics and falling sales of drugs including Lipitor, Norvasc and Zyrtec.
Meanwhile, Harley-Davidson Inc. fell 70 cents, or 2 percent, to $36.09 after the motorcycle maker said its profit declined, that it was cutting hundreds of jobs and that it would ship up to 27,000 fewer motorcycles this year.
IBM was among the bright spots, boasting a higher-than-expected 26 percent jump in profits. IBM rose $2.61, or 2.2 percent, to $123.08 and was among the biggest gainers of the 30 stocks that comprise the Dow Jones industrials.
Oil prices set another record high overnight, but crude fell 7 cents from Wednesday's close to settle at $114.86 a barrel on the New York Mercantile Exchange, the contract's first closing decline in a week.
Gold prices fell, while the dollar generally rose against other major currencies.