Wall Street slogged through an uneven session yesterday, finishing mixed as investors grappled with troubling consumer spending patterns...
NEW YORK — Wall Street slogged through an uneven session yesterday, finishing mixed as investors grappled with troubling consumer spending patterns, slower growth from the manufacturing sector and the latest news of Hurricane Katrina’s damage.
The Dow Jones industrial average fell 21.97 to 10,459.63 after posting a 68-point gain Wednesday.
Microsoft, one of the 30 Dow stocks, slipped 18 cents to close at $27.20 a share. Boeing, also a Dow stock, fell $1.03 to $65.99.
Broader stock indicators were narrowly mixed. The Standard & Poor’s 500 index rose 1.26 to 1,221.59, and the Nasdaq composite index dropped 4.19 to 2,147.90.
Most Read Stories
- Elizabeth Warren: ‘The next step is single-payer’ health care
- Seattle No. 1 in home-price growth again; starter homes require half of income
- Zillow vs. McMansion Hell: Seattle company not backing off fight with blog despite PR fiasco
- Washington lawmakers reach tentative state budget deal, but no details made public
- Ohio woman set on fire by ex-boyfriend in 2015 dies
Investors saw a disturbing trend in the Commerce Department’s consumer income and spending report. While consumer spending rose by a solid 1 percent in July, incomes rose just 0.3 percent. People spent more than they earned for just the second time in 46 years, and the nation’s savings rate fell to the lowest level ever recorded.
The nation’s manufacturing sector also saw an unexpected slowdown, with the Institute for Supply Management’s manufacturing index falling to 53.6 in August from 56.6 the previous month.
Yet the losses were minimal, and volume was extremely heavy for a market still struggling through Wall Street’s summer doldrums — a sign that investors were still willing to buy stocks, even if they didn’t quite know where to put their money.
Much of the worrisome disparity between income and spending can be blamed on record gasoline prices caused by the sharp rise in crude-oil futures this summer. Crude futures rose again yesterday, with a barrel of light crude settling at $69.47, up 53 cents, on the New York Mercantile Exchange.
In other economic news, the Labor Department said first-time jobless claims rose to a seven-week high of 320,000 last week, up 3,000 from the previous week. Unemployment claims are expected to rise significantly in the coming weeks because of layoffs spurred by Katrina.
While the economic data were troubling, the high trading volume showed investors were ready to find places to invest. However, their ability to make decisions was hamstrung by the debate over Katrina’s economic impact. Oil prices, of course, have been surging, but there may be economic positives to come from the disaster as money is spent to rebuild.
“You’ve got a push-pull between tragedy and the good that can come out of it for the markets,” said Jay Suskind, head trader at Ryan Beck. “You’ve got to rebuild, and you’re going to put money and resources into that and create jobs.”