Stocks crept lower yesterday as Wall Street steadied itself after last week's losses and waited for the Federal Reserve's meeting on interest...
NEW YORK — Stocks crept lower yesterday as Wall Street steadied itself after last week’s losses and waited for the Federal Reserve’s meeting on interest rates. Fears that second-quarter earnings could disappoint also weighed on the market.
The Dow Jones industrial average fell 7.06 to 10,290.78 after dropping nearly 290 points Thursday and Friday combined.
Microsoft, one of the 30 Dow stocks, added 1 cents to close at $25.05 a share. Boeing, also a Dow stock, soared $1.17 to $61.76.
Broader stock indicators also fell. The Standard & Poor’s 500 index slipped 0.88 to 1,190.69, and the Nasdaq composite index declined 8.07 to 2,045.20.
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The Fed’s Open Market Committee is widely expected to raise rates for the ninth time in a year when it meets tomorrow and Thursday, but investors are waiting to see policy-makers’ assessment of the economy, to be issued at the end of the meeting.
Until the Fed’s intentions are clear, investors are likely to do very little, said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. “Is this the ninth inning or are we going into extra innings?” he said.
Another factor that may keep stocks nearly flat in coming sessions is that analysts have slightly lowered expectations for second-quarter earnings, Ablin said. This is the first quarter of the last six where expectations have fallen.
Several companies issued warnings yesterday.
International Paper fell $1.02 cents to $31.43 after the company said second-quarter earnings would miss estimates because of weaker paper and packaging sales. Cardinal Health fell $4.08 to $56.43 after the company said investments in research and development and infrastructure would push 2006 earnings well below estimates.
In yesterday’s stock trading, some industries were strong, while others faltered. “It’s still a sector story,” Ablin said. “You’ve got very calm water, with a lot of stirring underneath the surface.”
Energy and utility stocks did well, thanks to increasing oil prices, but technology, health care and consumer staples lost ground, due to fears of an economic slow down.
Google announced a free Internet video viewer just a few hours before its red-hot stock reached a new closing high. Google’s shares ended yesterday’s trading session up $6.85, or 2.3 percent, to $304.10.
The limited scope of Google’s viewer means it won’t be competing — for now at least — with the popular multimedia players made by Microsoft and RealNetworks.
The stock went public last August at $85 a share.
Walgreen, the nation’s largest drugstore chain, posted a 20 percent increase in third-quarter profits yesterday, driven by strong generic drug sales and better margins in its digital photofinishing business. Its stock rose $1.47, to $45.85.