Wall Street pulls back
from 16-month highs
By Hope Yen
Associated Press
NEW YORK >> Wall Street retreated modestly from 16-month highs yesterday after investors welcomed another batch of strong earnings but worried that stock prices might nonetheless be too high.
"The market scored such a healthy gain in October that we're seeing a little bit of profit-taking as we wait for the rest of the third quarter reports to come in," said Lynn Reaser, chief economist and senior market strategist at Banc of America Capital Management.
The Dow Jones industrial average closed down 9.93, or 0.1 percent, at 9,803.05, having gained 48.60 in the previous session to its highest close since May 31, 2002. The Nasdaq composite index fell 4.09, or 0.2 percent, to 1,939.10, following an advance of 9.66 to its best finish since Jan. 28, 2002.
The Standard & Poor's 500 index dropped 2.72, or 0.3 percent, to 1,046.76, having gained 4.13 in the previous session to its highest finish since May 31, 2002.
Decliners beat advancers about 8 to 5 on the New York Stock Exchange. Consolidated volume was moderate at 1.95 billion shares, compared with 1.62 billion traded Tuesday.
The Russell 2000 index fell 4.49, or 0.8 percent, to 527.35.
The NYSE composite index fell 24.67, or 0.4 percent, to 5,935.61. The American Stock Exchange composite index dropped 6.09, or 0.6 percent, to 1,017.54.
The Treasury's two-year note fell 4/32 to 99 24/32, with its yield rising 7 basis points to 1.76 percent. The 10-year note lost 14/32 to 98 26/32, with its yield gaining 6 basis points to 4.40 percent.
The Commerce Department reported yesterday that the nation's retail sales fell by 0.2 percent; the number was slightly worse than analysts' estimates of a 0.1 percent dip. However, the government also revised sales figures upward for July and August to 1.4 percent and 1.2 percent, respectively.
Investors have pushed stocks to 52-week highs in recent days as investors become more confident that quarterly earnings will be better than expected. But analysts caution that the market could see declines if expectations become too high and companies don't meet them.
Losers included General Motors Corp., which fell 42 cents to $43.55 even though the automaker reported a jump in profits that beat analysts' forecasts.
Financial stocks also edged lower despite better-than-expected earnings. Wachovia Corp. slipped 2 cents to $44.29 and FleetBoston Financial Corp. fell 11 cents to $32.52.
IBM Corp. fell 16 cents at $92.74 in advance of the company's quarterly earnings report. After the market closed, IBM reported profits that met analysts' estimates; its revenue, however, fell short of projections. The company's shares continued their losses in extended-hours trading, falling $3.09. But Intel gained 68 cents to $31.76 after the semiconductor maker reported that quarterly profits doubled, beating Wall Street's forecast.
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