The Market Story

Return to Article

U.S. Stocks Ease Early

Sarina Penn

Wall Street was at a standstill early Thursday as mixed economic data helped offset the latest influx of disappointing corporate numbers.

The Dow Jones Industrial Average was up 30 points at 12,793, and the S&P 500 added 2 points to 1382. The Nasdaq Composite rose 3 points to 2408.

Futures had been pointing to a sharply lower open, but the mood improved after the Labor Department reported that the number of people filing for unemployment benefits dropped by 33,000 people last week to a better-than-expected 342,000. The consensus called for an unchanged figure.

Also, durable-goods orders stepped back 0.3% last month, according to the Commerce Department. That's worse than the flat number economists were expecting, but still an improvement on February's figure, which itself was revised to minus 0.9% from the prior drop of 1.7%.

Elsewhere, the Census Bureau said new-home sales in March sank 8.5% to a 526,000 annual pace. A number more on the order of 580,000 had been anticipated.

Among equities, Ford's (F Quote) shares bounced 6.7% after the carmaker posted a surprise first-quarter profit of $100 million thanks to a robust showing in Europe and South America. That offset a loss in its North American segment, which itself was narrowed sharply from last year.

Also rising was Credit Suisse (CS Quote), despite posting its first shortfall in more than five years as it wrote off $5.14 billion in bad assets. That pales in comparison to writedowns at Swiss rival UBS (UBS Quote), however, and Credit Suisse called its capital position "strong," suggesting it won't need to raise any cash, as UBS was forced to do this month. Credit Suisse shares rose 2.6%.

Weighing on tech shares, meanwhile, was Apple (AAPL Quote). The maker of Macs and iPhones comfortably bested analyst estimates last quarter with a 36% jump in profit, but also guided under earnings estimates for the current quarter. Shares were off 1.9%.

Amazon.com (AMZN Quote), another tech titan, was slumping 4.1% after easing its 2008 operating-earnings forecast and reporting an essentially flat operating margin in the first quarter. Analysts were hoping for some improvement. The Internet retailer also reported better-than-expected earnings of $143 million on soaring sales of $4.13 billion.

Similarly, Motorola (MOT Quote) surrendered 4% after its quarterly loss and weak second-quarter projection.

Outside of tech, Starbucks (SBUX Quote) was also losing ground on its soft guidance. The coffee seller said tough economic conditions should keep its customer-traffic numbers down and force a first-quarter profit drop to 15 cents a share from 19 cents last year. That's well under the consensus estimate. Shares were plunging 11%.

Scheduled to report after the market close are Dow components Microsoft (MSFT Quote) and American Express (AXP Quote).

Among commodities, crude oil was losing 80 cents to $117.50 a barrel, and gold futures gave up $5.10 at $903.90 an ounce. The U.S. dollar climbed 0.9% against the euro at $1.5746 while weakening fractionally against the yen.

Treasury prices were little changed recently. The 10-year note was up 1/32 in price to yield 3.73%, and the 30-year bond was flat in price, yielding 4.49%.

Markets overseas were mostly in retreat. The Hang Seng Index in Hong Kong jumped 1.6% overnight at 25.681, but Tokyo's Nikkei 225 lost 0.3%. In Europe, London's FTSE 100 dropped 1.7%, Germany's Xetra Dax shed 0.7%, and the Paris Cac fell 1.4%.