Stocks ended mixed on Monday, tempered by a small rebound in oil prices. The Dow average was pressured by downgrades of some blue chips while the Nasdaq edged higher on a bullish outlook on Apple Computer (AAPL ) and other tech issues.
The Dow Jones industrial average ended down 45.15 points, or 0.43%, to 10,547.06. The broader Standard & Poor's 500 index was off 0.92 point, or 0.08%, to 1,190.25. The Nasdaq composite index rose 3.29 points, or 0.15%, to 2,151.25.
In the energy markets, January NYMEX crude settled up 44 cents to $42.98 per barrel amid speculation that OPEC may cut production levels, or more likely aim to reduce "slippage" over official quotas when it meets on Cairo on Friday, says Action Economics. Reports of an attack on the U.S. consulate in Jeddah, Saudi Arabia supported oil prices as well.
Looking ahead, on Tuesday grocery chain Kroger (KR ) and directing marketing outfit Alloy (ALOY ) will report earnings.
On the economic calendar, revised figures for third-quarter productivity and labor costs are due out. Productivity is expected to show a 2.1% increase in the third quarter vs. the 1.9% increase shown in preliminary figures. Unit labor costs are expected rise 1.4% vs. the 1.6% gain in the earlier reading.
On Monday, the Nasdaq kept afloat thanks to computer stocks like Apple. JP Morgan raised its revenue and profit estimates for the PC company that makes the wildly popular iPod digital music player because of expectations for strong holiday sales. Chipmaker Intel (INTC ) was also higher.
Meantime, the Dow fell on a slew of broker downgrades. Among them, drugmaker Pfizer (PFE ) was under pressure after Merrill Lynch cut its investment rating to neutral from buy, saying it believes the stock has only modest upside potential.
Goldman Sachs lowered its rating on aluminum producer Alcoa (AA ) to in-line from outperform.
In other corporate news, handheld device maker 3Com (COMS ) warned of a wider than expected second-quarter loss per share and lower revenue.
Meantime, electronics retailer Circuit City (CC ) posted 4.3% lower fiscal third-quarter same-store sales from lower traffic.
On the plus side, truck maker Navistar International (NAV ), sees fourth-quarter profits and revenue as the stronger U.S. economy leads to orders for its trucks and engines.
But also worrying to investors was the dollar, which retested its record low against the euro. Global investors are worried about the huge U.S. current account deficit.
Treasuries ended mostly higher in price in a quiet session amid no economic data releases or important Fed speak, according to Informa Global Markets. Some jitters on the geopolitical front took center stage, yet bonds continued to benefit from the post-payrolls report and safe-heaven buying from the volatility in Iraq, Informa says.
European stock markets finished lower on Monday. London's FTSE 100 index was off 25.1 points, or 0.53%, to 4,722.8 after Brent crude oil futures rose 41 cents to $39.77 and a report that UK October industrial fell more than expected 2%. BAE Systems was lower after saying profit from its largest contract will fall in 2005 as more of the work is carried out in Saudi Arabia. Acal was lower after first-half profit fell as demand for information-technology services and products dropped. Carclo was higher after posting first-half profit after selling land in Scotland.
Germany's DAX index fell 14.96 points, or 0.36%, to 4,193.91 despite a report that Bundesbank's Weber sees 2005 economic growth at 1.2-1.3%, which is somewhat lower than the European Commission's October forecast of 1.9% growth this year and 1.5% growth next year. There was little reaction that German October factory orders rose a more than expected 1.1%. Commerzbank was higher after UBS raised its recommendation to neutral from reduce. Deutsche Postbank was lower after UBS cut its recommendation to reduce from neutral.
In Paris, the CAC 40 index lost 16.12 points, or 0.43%, to 3,767.39 as energy prices rose and European retail sales fell in November. LVMH was lower as the lower dollar hurts its exports. Rhodia was lower after Total said it wasn't interested in buying the company. Ciments Francais was lower after offering to buy the two-thirds of Egypt's Suez Cement Co. that it doesn't already own.
In Asia, the markets finished mixed on Monday. Japan's Nikkei 225 index dropped 92.93 points, or 0.84%, to close at 10,991.96 as market sentiment was hurt by a weak U.S. jobs report, which pushed down the U.S. dollar against the yen. Toyota Motor slid 1.79%, while Sony edged down 0.53%. But Mitsubishi Motor rose 0.89% on reports of a tie-up with Nissan Motor, while Fujitsu jumped 2% after it said it would form a strategic alliance with Cisco Systems.
In Hong Kong, the Hang Seng index added 45.02 points, or 0.32%, to close at 14,256.86, with gains in financials and utilities being countered by losses in properties and industrial names.