Stocks drifted lower in quiet trading yesterday as oil prices edged upward and concerns about the automotive sector intensified after Ford...
NEW YORK — Stocks drifted lower in quiet trading yesterday as oil prices edged upward and concerns about the automotive sector intensified after Ford slashed its profit outlook for the year.
The Dow Jones industrial average slid 12.78 to 10,448.56.
Dow industrial Microsoft added 3 cents to close at $24.97 a share after the company announced a settlement with computer maker Gateway over antitrust issues. Boeing, also a Dow stock, gained 80 cents to $59.40.
Broader stock indicators were mixed. The Standard & Poor’s 500 index was up 0.01 at 1,181.21. The Nasdaq composite index lost 7.23 to 1,992.12.
Most Read Stories
- Woman, 71, lost in Olympics with dog, built shelter, ate ants
- 3 teens killed in Lynnwood crash from Mill Creek high school
- Foreign buyers drop off as Seattle housing market hits hottest tempo since 2006 bubble
- What drivers can and cannot do under Washington state's new distracted-driving law
- Are Seattle housing prices headed for a crash? | Jon Talton
Investors initially welcomed reports that OPEC plans another production increase in May to meet steady demand. Crude futures climbed higher, however, breaking a five-session streak of lower prices. A barrel of light crude settled 39 cents higher at $53.71 on the New York Mercantile Exchange.
Falling oil prices helped the major indexes post weekly gains for the first time in a month, but crude futures remain high and analysts warned that investors will need to see strong first-quarter earnings over the next few weeks for stocks to recover further. Ford’s announcement fed doubts about whether corporate America can keep profits up in the face of high energy costs.
“Right now, you see the economy growing and things are looking pretty good, despite all the worries,” said Hans Olsen, managing director and chief investment officer at Bingham Legg Advisers. “But while the economy is climbing that wall of worry, stocks are running right into it. We’ll need to see some pretty good earnings down the road to overcome that.”
Stocks fluctuated in and out of positive territory for much of the session, and volume was light — signs of a market in a holding pattern as earnings reports start to come in.
“Most people are very risk averse. They don’t want to make a mistake right now, so you see people reacting, not anticipating,” said Paul McManus, chief investment strategist with Independence Investments. “People are just going to be sitting at their desk, reading a bunch of earnings reports, gauging who looks good through the summer and then they’ll take positions.”
Ford weighed on the markets as the automaker said higher expenses and a difficult market would cut into its quarterly and full-year profits. Two brokerages downgraded the company’s stock, and Standard & Poor’s also cut its rating on Ford’s debt. Ford tumbled 59 cents, or 5.4 percent, to $10.44, on the news.