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NEW YORK >> Stocks dipped modestly lower today after earnings warnings from companies including Microchip Technology and Nautilus Group offset investor optimism about a quick end to the war. Earnings
warnings
hit stocksBy Hope Yen
Associated PressTrading was light and choppy, with many investors noncommittal amid fresh rumors that Iraqi President Saddam Hussein might have been killed in an air bombing yesterday.
"Several weak earnings reports have temporarily put the focus on earnings rather than positive news on the war," said Michael Sheldon, chief market strategist at Spencer Clarke. "Investors right now are concerned that earnings in the first quarter will be on the weak side."
Still, "overall economic news continues to take a back seat to news from Iraq," he added. "As long as the U.S. appears to achieve a relatively quick victory, market declines should be minor and met with investor buying."
Declining issues outnumbered advancers 4 to 3 on the New York Stock Exchange.
The Dow Jones industrial average closed down 1.49 at 8,298.92, having gained 23 points yesterday. Earlier in the day, blue chip stocks gained as much as 42 points.
The broader market also finished modestly lower. The Nasdaq composite index dropped 6.57, or 0.5 percent, to 1,382.94. The Standard & Poor's 500 index fell 1.64, or 0.2 percent to 878.29. The Russell 2000 index fell 1.91, or 0.5 percent, to 374.66.
The price of the Treasury's 10-year note was up 3/8 point, while its yield fell to 3.93 percent from 3.98 percent yesterday. Two-year Treasury notes were up 1/16 point and yielded 1.56 percent, down from 1.60 percent yesterday.
U.S. forces today dropped bombs on a Baghdad building where Saddam and his two sons were believed to be; Pentagon officials said it could be days before they know if the leader survived. President Bush also met with British Prime Minister Tony Blair to discuss plans for a postwar Iraq.
Trading has been choppy in recent weeks as investors focus on the latest war developments. Analysts say while investors are confident of a U.S. victory, they remain uncertain about the toll on the U.S. economy.
"A victory is a matter of days, not a matter of weeks. That's the conclusion the markets have clearly reached," said Hugh Johnson, chief investment officer at First Albany Corp.
"So as time goes on, the focus is very grudgingly, very gradually shifting from Iraq to the economy and earnings. That may in part explain why the stock market to some extent has stalled," he said.
Indeed, several earnings warnings weighed on stocks today.
Microchip Technology dropped $1.87 to $18.66 after the semiconductor company lowered its fiscal fourth-quarter outlook.
Accredo Health tumbled $11.11, or 43.7 percent, to $14.29 after the company lowered its 2003 profit outlook and said an accounts review of an acquisition may lead to a charge against the year's earnings.
And Nautilus Group slid $3.71, or 24.9 percent, to $11.19 after the maker of StairMaster and Bowflex fitness equipment lowered its first-quarter and full-year outlook, citing the slowing economy.
Overseas, Japan's Nikkei stock average finished 1.4 percent lower. In Europe, France's CAC-40 dropped 1.4 percent, Britain's FTSE 100 lost 1.7 percent and Germany's DAX index fell 1.5 percent.
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