Star-Bulletin news services
Stocks end mixed
on upbeat GDP report
NEW YORK >> Wall Street had a mixed session yesterday as investors applauded a surprisingly strong third-quarter gross domestic product but nonetheless worried that the increase could not be sustained.
Analysts said the GDP report did not have more of a market impact because it reflected past economic performance, and investors were not certain future growth would be as robust. Disappointing earnings from Exxon Mobil Corp. also weighed on shares.
"The sustainability is the biggest question," said Brian G. Belski, fundamental market strategist at US Bancorp Piper Jaffray. "The question is what is the current GDP and what will the growth be over the next three quarters?"
Advancing issues narrowly outnumbered decliners on the New York Stock Exchange. Consolidated volume was heavy at 2.10 billion shares, compared with 2.04 billion traded Wednesday.
The Dow Jones industrial average closed up 12.08, or 0.1 percent, at 9,786.61, following a three-day gain of 192 points. Earlier in the day, the blue-chip average advanced as much as 64 points and lost as much as 20 points.
But the broader market declined modestly. The Nasdaq composite index lost 3.87, or 0.2 percent, to 1,932.69. The Standard & Poor's 500 index fell 1.17, or 0.1 percent, to 1,046.94. The Russell 2000 index fell 1.44, or 0.3 percent, to 530.37.
The price of the Treasury's 10-year note closed down 7/16 point, while its yield rose to 4.35 percent from 4.29 percent yesterday. Two-year Treasury notes were down 1/8 point and yielded 1.87 percent, up from 1.75 percent yesterday.
The Commerce Department reported yesterday that the nation's gross domestic product grew at a 7.2 percent annual rate in the third quarter. It was the strongest pace since the first quarter of 1984; it also beat analysts' estimates for a 6 percent growth rate.
Meanwhile, the Labor Department reported that new jobless claims last week declined by 5,000 to 386,000, signaling a slowdown in layoffs.
"Certainly the GDP number was good and the market celebrated that," said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee. "But no one expects this number to continue at this rate, and they do expect the numbers" to be eventually revised lower, he said.
Martha Stewart Living Omnimedia Inc. rose 41 cents to $10.40 after the multimedia company reported a quarterly loss that was narrower than analysts' predictions.
Losers included Exxon Mobil, which fell $1.51 to $36.30, after the oil company reported third-quarter earnings that missed analysts' estimates.
Aetna Inc. declined $2.49 to $56.30 after the insurance giant posted quarterly profits that came in higher than Wall Street's projections.
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