Stocks ended lower Tuesday, with the tech-laden Nasdaq falling below the 2,000 mark, and to its lowest level so far in 2004, as investors fretted over mixed news from the tech sector, which had helped power the equities rally that began a year ago.
The Nasdaq composite index lost 13.62 points, or 0.68%, to 1,995.16, and is now down for the year. The Dow Jones industrial average lost 72.52 points, or 0.69%, to 10,456.96. The broader Standard & Poor's 500-stock index was down 6.63 points, or 0.58%, to 1,140.57.
By the end of Tuesday's trading, Wall Street was already turning its attention to Wednesday's session, when a slew of companies are due to reports results. Among them are doughnut chain Krispy Kreme Doughnut (KKD), apparel retailers Quiksilver (ZQK) and Talbots (TLB), and ski resort operator Vail Resorts (MTN).
On the economics front, January trade figures are expected to show that the trade gap slimmed slightly to $42 billion from $42.5 billion in the previous month. Meantime, wholesale invetories are expected to show a rise of 0.4% in January, vs. 0.6% in December.
On Tuesday, Standard & Poor's MarketScope noted that it was seeing a continued rotation out of cyclical stocks and into more conservative consumer staples. Says Informa Global Markets: "There are concerns valuations are too high at the same time investor sentiment gauges are overbought."
Among the stocks hurting the Nasdaq was computer server maker Sun Microsystems (SUNW). Sun was downgraded by Banc of America over concerns about its Unix business.
Shares of Texas Instruments (TXN), which makes microchips, fell despite news that the company raised its first-quarter earnings and revenue targets, thanks to strong demand for many products.
Foundry Networks (FDRY) plunged nearly 16% on reports that the company sees first-quarter results near the fourth quarter's.
Nike (NKE) shares rose after the athletic shoe and apparel maker says it expects February-quarter revenue to increase more than 20% over the prior year.
In other equities news, Halliburton (HAL), the oil services giant formerly run by Vice President Dick Cheney, disclosed in a regulatory filing that it could be audited by the U.S. Dept. of Defense related to its work in Iraq.
No. 1 grocery chain Kroger (KR) posted a quarterly loss, citing the labor dispute in Southern California and charges in ts Smith's division. Rival Albertson's (ABS), the second largest player, posted a 37% decline in quarterly profit, also blaming the labor problems.
And Interpublic Group (IPG), the second largest advertising agency group, reported a quarterly loss due to restructuring costs.
Meantime, forest products outfit Weyerhaeuser (WY) agreed to pay $34.5 million to settle an antitrust case and anticipates taking a first-quarter charge.
Treasuries moved higher in price, as the post employment report rally continued for the third consecutive session, says economic research outfit Informa Global Markets. The yield on the benchmark 10-year note fell to 3.71%. There was no major economic data today.
European stock markets ended lower on Tuesday. London's Financial Times-Stock Exchange 100 index eased 6.5 points, or 0.14%, to 4,547.3 as a Bank of England official warns that the rate of Britain's house price inflation is not sustainable. Britain's industrial production rose only 0.1% in January, while the country registered its largest trade deficit on record thanks to drop in exports.
Germany's DAX index lost 58.44 points, or 1.41%, to 4,087.55 as economic adviser Ruerup said there's no need for the European Central Bank to cut rates to bolster the economy. German industrial production fell 0.1%, but that is in line with expectations and might have been weather related.
In Paris, the CAC 40 gave up 44.35 points, or 1.17%, to 3,737.03 amid reports that French public debt rose to a 7-year high in 2003 and that fourth quarter new home sales rose 13%.
In Asia, markets finished mixed overnight. Tokyo's Nikkei 225 index added 29.18 points, or 0.25%, to 11,532.04, with bank stocks contributing the most to the advance.
In Hong Kong, the Hang Seng index lost 176.29 points, or 1.3%, to 13,397.25.