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Speculation leads
to drifting markets
NEW YORK >> Investors bought tech shares yesterday but made few other commitments ahead of the government's February employment report, leaving stocks mixed in still another lethargic session on Wall Street.
The market's major indexes drifted in and out of positive territory as they have much of the week ahead of today's employment report. The report, showing the number of new jobs created or lost during the month, is considered one of the most critical indicators of the economy's health.
"There's been a lot of speculation about where the number might come in and how the market might react, so it makes sense for this to be a bit of a directionless day," said Brian Pears, head equity trader at Victory Capital Management in Cleveland.
The Dow Jones industrial average, which traded in a narrow, 45-point band, closed down 5.11, essentially flat at 10,588.00.
The broader gauges were higher. The Nasdaq composite index advanced 21.75, or 1.1 percent, to 2,055.11, as gains among semiconductor stocks helped it finish in positive range after two down days. The Standard & Poor's 500 index was up 3.84, or 0.3 percent, at 1,154.88.
The price of the Treasury's 10-year note closed up 1/4 point, while its yield fell to 4.02 percent from 4.05 percent Wednesday. Two-year Treasury notes were up 1/32 point and yielded 1.64 percent, down from 1.73 percent Wednesday.
Investors, who have traded listlessly for weeks in the absence of galvanizing economic or earnings data, were disappointed again yesterday. They seemed put off by a Commerce Department report that orders to U.S. factories fell by 0.5 percent in January. Weaker demand for transportation equipment, especially airplanes, pulled the overall number down. Excluding transport, factory orders rose 1.4 percent.
But there was some upbeat news: The number of new applications filed for unemployment benefits declined more than expected last week, the Labor Department said. The reading, considered an indicator of the level of layoffs, was seen as a sign that companies are feeling more confident about the economy.
Separately, the department said productivity of American workers grew at a modest 2.6 percent annual rate during the final three months of 2003. That matched analyst forecasts, but was slightly slower than the 2.7 percent pace estimated by the government last month.
The lack of significant employment growth has been a sticking point in the recovery. Although companies seem to be laying off fewer workers, they haven't been in a rush to hire people back. Still, a Federal Reserve survey released Wednesday found jobs are growing, albeit slowly, and economists remain optimistic about the outlook.
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