Stocks Mixed As Investors Eye Oil Prices
NEW YORK – Stocks were mixed in quiet trading Wednesday as investors weighed rising oil prices against a pair of government reports that gave conflicting signals about the economy.
With the Republican convention still ahead, crude futures back up after three days of declines and a long list of worries preoccupying Wall Street, investors don’t seem to be in any hurry to commit money to stocks.
“I think the market is looking for a catalyst and right now there is just not a lot going on,” said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee. “People are waiting. They don’t want to do anything based on one set of assumptions only to see things turn out the other way.”
In late morning trading, the Dow Jones industrial average shed 2.21, or 0.02 percent, at 10,096.42.
The broader gauges were narrowly mixed. The Nasdaq composite index was up 2.12, or 0.1 percent, at 1,839.01. The Standard & Poor’s 500 index was off 0.09, or 0.01 percent, at 1,096.10.
Soaring fuel prices have pressured the market for weeks, with oil prices recently topping $46 per barrel, a record level. While prices have softened somewhat over the last few sessions, renewed supply concerns pushed crude futures higher Wednesday, up 4 cents at $45.25 on the New York Mercantile Exchange.
Investors were pleased with the latest report from the Commerce Department, which said orders for costly manufactured goods rose by 1.7 percent in July, an encouraging sign that the economy is shaking off summer doldrums. The best reading in four months for durable goods – big-ticket items expected to last at least three years – was boosted by demand for airplanes, machinery and communications equipment.
But the department found sales of new homes declined by 6.4 percent in July, a far steeper drop than analysts anticipated. The decline left home sales at their lowest level since December. Figures for June were also revised lower. Analysts said the challenging labor market and rising energy prices may be making some people wary about purchasing a new home.
Among the beneficiaries of rising orders, Dow component Boeing Co. rose $1.34 to $52.25 on news that Singapore Airlines had ordered up to 31 long-range Boeing 777-300 jetliners.
Toll Brothers Inc. fell 80 cents to $42.66, despite reporting a 56 percent surge in profits and raising its forecast for the year based on current demand and its backlog of orders for new luxury homes. Enthusiasm for the homebuilder, which surged in early trading, waned on the news of sliding home sales.
Williams-Sonoma Inc. rose 10 percent, or $3.24, to $34.74, after reporting a 55 percent jump in second-quarter profits on strong sales at Pottery Barn and its outlet stores. The home product retailer also raised its revenue estimates and reiterated its income guidance while elevating earnings, revenue and sales forecasts for the year.
Gap Inc. fell 75 cents to $19.17 after brokerage firm Merrill Lynch downgraded the retailer to “neutral” from “buy” on concerns about sluggish sales, which could continue to decline this fall amid pressure on consumer spending, a mediocre product line and the company’s decision to focus on young adults instead of back-to-school fashions. The brokerage firm’s analyst also lowered earnings-per-share estimates for the rest of this year and next.
Declining shares slightly outnumbered advancers on the New York Stock Exchange. Volume came to 305.58 million shares, compared to 321.28 million shares traded at the same point Tuesday.
The Russell 2000 index, which tracks smaller company stocks, was down 1.07, or 0.2 percent, at 543.94.
Overseas, Japan’s Nikkei stock average finished 1.3 percent higher Wednesday. In afternoon trading in Europe, France’s CAC-40 added 0.03 percent, Britain’s FTSE 100 was unchanged and Germany’s DAX index added 0.5 percent.
—-
On the Net:
New York Stock Exchange: http://www.nyse.com
Nasdaq Stock Market: http://www.nasdaq.com