Stock Prices Slip in Early Trading

NEW YORK – Stock prices are slightly lower in early trading as investors digested the market’s huge gains of last week and received news of a potential big telecom deal. The Dow Jones industrial average is down 0.32 at 13,906.93.

The Nasdaq Composite Index has dropped 4.18 to 2,702.82, and the Standard & Poor 500 index is off 2.08 at 1,550.42.

Investor sentiment may get a boost from renewed talk of acquisition activity, which has been a big driver of the stock market’s gains in the past year. Vodaphone Group PLC is weighing whether to make a huge $160 billion bid for Verizon Communications Inc., the Financial Times reported Monday. The newspaper cautioned that Vodaphone has yet to approach Verizon. Vodaphone, the report said, would pursue the deal to obtain full ownership of Verizon Wireless, which Vodaphone and Verizon now own jointly.

In a much more modest but confirmed, deal, restaurant chain operator IHOP Corp. said it would acquire Applebee’s International Inc. for about $1.9 billion.

Stock futures showed little reaction to the New York Federal Reserve’s Empire State Manufacturing Survey that found regional manufacturing activity continued to improve in July.

Dow Jones industrial futures expiring in September rose 2, or 0.01 percent, to 13,975, while Standard & Poor’s 500 index futures slipped 0.80, or 0.05 percent, to 1,559.30. Nasdaq 100 index futures rose 1.00, or 0.05 percent, to 2,047.75.

Last week’s run-up came ahead of a flurry of quarterly results – 11 of the 30 companies that make up the Dow Jones industrials are due to report this week – and in advance of key readings on inflation.

Forecasts from companies should help indicate whether they can continue to put up solid profit growth as pricing pressures fluctuate, in part because of forces such as rising oil prices.

In other corporate news, McDonald’s Corp. predicted its second-quarter earnings before charges will top Wall Street’s forecast.

Mattel Inc. saw its second-quarter earnings rise 15 percent as increased sales global of its Barbie dolls and Hot Wheels toy cars made up for soft U.S. sales.

Ford Motor Co. denied various reports that it is in talks to sell its Volvo division.

Royal Philips Electronics NV, the maker of medical and lighting equipment, reported its second-quarter net profit rose following the sale of its stake in a Taiwanese semiconductor company. The company also said, however, that currency exchange rates hurt sales.

On Monday, light, sweet crude futures fell 18 cents to $73.75 in premarket electronic trading on the New York Mercantile Exchange.

In Asia, Japan’s Nikkei stock average finished flat. Hong Kong’s Hang Seng Index fell 0.63 percent, while the often-volatile Shanghai Composite Index fell 2.36 percent.

In afternoon trading, Britain’s FTSE 100 fell 0.39 percent, Germany’s DAX index rose 0.03 percent, and France’s CAC-40 fell 0.22 percent.

The dollar was mixed against other major currencies and continued to hover near its record lows against the euro. Gold prices fell.

—

On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com