Stocks Finish Mixed Amid ECB Speculation
NEW YORK (TheStreet) -- U.S. stocks finished mixed Wednesday as traders mostly stood pat ahead of tomorrow's European Central Bank policy meeting.
It was a slow session filled with speculation about how ECB President Mario Draghi plans to address the old continent's debt problems and keep the single-currency eurozone intact. Bloomberg reported Draghi is set to propose a sterilized bond-buying program of unlimited size but the details of such a proposal and how it would actually be implemented remain to be seen.
The Dow Jones Industrial Average closed up more than 11 points, or 0.09%, at 13,047. The blue-chip index ranged less than 77 points on the day.
Winners outnumbered losers, 18 to 12, within the Dow. Walt Disney (DIS), Boeing (BA) and Alcoa (AA) were the standout gainers, while American Express (AXP), Cisco (CSCO), and Kraft Foods (KFT) were weak spots.The S&P 500 fell 1.5 points, or 0.11%, to settle at 1403.44, while the Nasdaq gave back nearly 6 points, or 0.19%, to finish at 3069. The weakest sectors in the broad market were transportation, technology and energy, while conglomerates, health care and basic materials were in the green. Volume totaled 3.37 billion on the New York Stock Exchange and 1.49 billion on the Nasdaq. "We move towards the ECB meeting tomorrow, with markets looking for reasons to be volatile," said Paul Donovan, global economist at UBS. "We expect the ECB to ease the refi (not the discount) rate and to give a broad outline of the bond buying program -- with the constraint that we still have the German court ruling [the permanent European rescue fund] ahead." Capital Economics argued there's still potential for disappointment at tomorrow's policy meeting with the firm saying "the lack of a limit on bond buying could simply reflect unwillingness on behalf of the ECB to commit to a specific amount of purchases rather than anything bolder." Wednesday's U.S. economic data was mildly positive. The Bureau of Labor Statistics provided a revised read on U.S. second-quarter nonfarm business productivity of up 2.2%, above the 1.8% gain expected by economists. The report said the read on second-quarter unit labor costs was revised to a 1.5% increase, as expected. The previous read showed a 1.7% gain. The data from across the pond was more troublesome. European Union's statistics office said Wednesday that retail trade in the region fell 0.2% in July from June as worsening economic conditions hurt consumer demand. Also, Markit published data showing that its August composite PMI index on manufacturing and services declined to a revised 46.3, down from the flash reading of 46.6 and the July level of 46.5.
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