Stocks posted minor losses Tuesday to close at their lowest levels of 2004, extending their losing streak to a fourth straight session. Ongoing worries about the economy and the geopolitical situation overshadowed upbeat corporate news. Tuesday's declines, however, were smaller than in previous sessions.
The major indexes spent most of the session in the black before sellers took control in the final hour. The Dow Jones industrial average was off 1.11 points, or 0.01%, at 10,063.64. The broader Standard & Poor's 500-stock index fell 1.50 points, or 0.14%, to 1,093.90. The Nasdaq composite index lost 8.10 points, or 0.42%, to 1,901.80. Some 1.44 billion shares changed hands on the Big Board while volume on the Nasdaq was 1.82 billion.
Wednesday's earnings calendar is rather light, with chipmaker Micron Technology (MU ) one of the few big-name companies due to report.
But the market will have some economic reports to digest for a change. Among them, orders for big ticket items are expected to show a rise of 1% in February, according to Informa Global Markets, vs. a 2.3% decline in January. As for new homes sales in February, the rate is expected to slow to a 1.1 million annualized pace from a 1.106 million pace in January.
Stocks fell to new year lows on Tuesday following news on Monday that Israel had assassinated the leader of militant group Hamas, raising fears of global insecurity. Recent economic reports have shown scant job creation, also causing investors to fret about whether the economic recovery can be sustained.
The gloomy mood on Wall Street came despite some positive corporate news. Investment bank Goldman Sachs (GS ) posted quarterly earnings that more than doubled, lifted by strong revenue from stock and bond trading.
McCormick & Co. (MKC ), the world's largest spice maker, posted higher quarterly profits, helped by greater sales to grocery stores and restaurants.
Software giant Microsoft (MSFT ) vowed to appeal a European Union ruling that includes a $614 million fine for alleged antitrust violations.
Limited Brands (LTD ) raised its first quarter earnings target thanks to stronger-than-expected sales at its Victoria's Secret and Bath & Body Works chains.
PalmOne (PLMO ), the handheld computer maker, reported a narrower third-quarter loss, helped by strong sales of its Treo 600 combination phone and digital organizer.
In other stocks in the news, Wal-Mart Stores (WMT ), the world's largest retailer, announced it officially launched its online music store
Discount retailer Family Dollar Stores (FDO ) posted its highest fiscal second-quarter profits ever thanks to record sales.
In economics news, a report from an industry group showed that U.S. retail chain stores rose 0.2% last week, following a 0.5% gain the week before, according to Informa Global Markets. Informa notes that giant retailers Wal-Mart and Target both reported that March sales so far are on track to hit the high end of their sales target of around 6%. Seasonal items and clothing are continuing to sell well, with rising gasoline prices and weaker stock market so far not hurting traffic. A pickup in tax refunds is seen as an offset.
Treasuries finished with modest price gains in a narrow session. The ratcheting up in global tension continuing to support fixed-income investments.
In other economics news, U.S. gas prices have hit record highs, says Informa, citing AAA, the nation's largest auto and travel club. The average retail price of regular gasoline hit $1.738 a gallon - besting the prior all-time high of last September. Meanwhile, the U.S. Energy Dept. predicts gasoline prices will hit a record over the peak summer driving season as strong demand and tight refinery capacity impact, Informa says.
So far, higher fuel costs have yet to dampen weekly retail spending although a rise in crude oil above $40 could weigh on both consumer and business sentiment, Informa adds.
European stock markets closed mixed on Tuesday. London's Financial Times-Stock Exchange 100 index was off 15.30 points, or 0.35%, to 4,318.50 after a short covering rebound was interrupted briefly by a bomb scare at Paddington Station. Some 52 FTSE stocks were lower while 46 were higher on turnover of 494 million shares. Compass Group was higher after Lehman raised its share price forecast 14%.
In Paris, the CAC 40 gained 0.69 points, or 0.02%, to 3,530.91 on short covering. There was little reaction to a report that French consumer spending was unchanged in February after being revised higher in January. Some 20 CAC stocks were higher and 19 were lower on turnover of 39 million shares. Germany's DAX index slipped 0.41 points, or 0.01%, to 3,728.82 as some 17 DAX stocks were higher and 12 were lower on turnover of 46 million shares. There was little news to move market. KarstadtQuelle was lower after saying first quarter sales will decline as much as 5% because of sluggish consumer spending. There was a Finance Ministry report said Germany's economic recovery is export led.
In Asia, the equity markets finished mixed. The Nikkei 225 index fell 37.42 points, or 0.33%, to 11,281.09.
In Hong Kong, the Hang Seng index advanced 37.45 points, or 0.30%, to 12,588.36.