Wall Street closed mixed today, recuperating from a sharp plunge as investors snapped up bargain stocks on rumors that a bond insurer rescue...
NEW YORK — Wall Street closed mixed today, recuperating from a sharp plunge as investors snapped up bargain stocks on rumors that a bond insurer rescue plan is progressing and on upbeat comments from Cisco Systems and Amazon.com.
The Dow Jones industrial average closed down 45.10 at 12,213.80, after tumbling more than 200 points earlier in the day.
Microsoft, one of the 30 Dow stocks, gained 60 cents to close at $27.59 a share. Boeing, also a Dow stock, fell $1.05 to $79.62.
Broader stock indicators finished mixed, also rebounding off their lows of the session. The Standard & Poor’s 500 index fell 4.59 to 1,326.75, while the Nasdaq composite index rose 1.68 to 2,260.28.
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The Dow fell sharply early in the session after Merrill Lynch lowered its full-year earnings prediction for Citigroup, which a Dubai fund executive said will need to raise more cash to stay in business. Another damper on trading was Intel, which lowered its forecast for first-quarter profit margins.
But in afternoon trading, the stock market showed signs of optimism. The financial sector regained some steam after CNBC reported that a plan to save the bond insurer Ambac Financial is advancing nicely.
Technology stocks rebounded, too, after a Dow Jones Newswires report that Cisco CEO John Chambers said he is “even more comfortable” with the long-term growth targets the company has outlined, and after Amazon.com’s chief financial officer reiterated the online retailer’s 2008 revenue forecast.
Wall Street is jittery, however, and as the volatility of the past several months has proved, the market’s optimism can quickly turn to pessimism from one day to the next. While some investors search for bargains when stocks sink, the overall market is plagued by persistent worries about the bad debt held by the world’s banks.
“What we’re seeing is a very nervous market, and nervousness breeds volatility,” said Anthony Conroy, managing director and head trader for BNY ConvergEx Group. “It took years to put this stuff on their books — it’s not going to come off quickly.”