Weak Data Hit Stocks
Updated from 8:07 a.m. EDT
Stocks on Wall Street were falling early Thursday as a disappointing economic report robbed the market of its earlier upward momentum.
The
Dow Jones Industrial Average
sank 24 points to 12,874, and the
S&P 500
was off marginally at 1408. The
Nasdaq Composite
edged down 1 point to 2496.
Index futures had been pointing to a higher open, but the sentiment turned downward after the
Federal Reserve
said industrial production fell 0.7% in April, worse than the 0.3% decline that had been expected. March was revised to show an increase of only 0.2%, rather than the 0.3% uptick that had been reported.
Capacity utilization was also a bit light, coming in at 79.7% compared with the 80.1% consensus forecast.
Another drag was the New York Empire State manufacturing index, which registered at negative 3.2, whereas analysts were expecting a reading of 0.
Elsewhere on the economic docket, jobless claims were roughly in line with expectations, rising by 6,000 to 371,000. That was about 1,000 more than had been predicted.
Last time out, the major indices rallied strongly for most of the session thanks to encouraging inflation data, until the final hour, when profit-taking deflated most of those gains. At the end of the day, the Dow rose 66 points to 12,898, and the S&P 500 climbed 6 points to 1409. The Nasdaq edged up 2 points to 2497.
As the new day began, traders were greeted with word that
CBS
(CBS) - Get Report
would buy Internet media company
CNET
(CNET) - Get Report
for $1.8 billion. That news lifted CNET by more than 40%, but CBS was slipping 3%.
General Electric
(GE) - Get Report
, a component of the Dow, was another early gainer, tacking on 0.7% following a report in
The Wall Street Journal
that the company is considering selling or parting ways with its appliances division. The unit could fetch $5 billion to $8 billion, the report said.
Meanwhile, investors were mulling reports that billionaire investor Carl Icahn -- who was said earlier this week to have begun acquiring large amounts of
Yahoo!
(YHOO)
stock -- has lined up 10 possible directors to nominate as replacements for the Internet company's board. Yahoo! shares were up 1.7% in the premarket.
Icahn's interest came after
Microsoft
(MSFT) - Get Report
walked away from its merger offer for Yahoo!.
Elsewhere, Britain-based bank
Barclays
(BCS) - Get Report
lost 3.3% after reporting a $1.94 billion writedown and saying its first-quarter profit had withered from last year.
JC Penney
(JCP) - Get Report
said its first-quarter income plunged by 50% from a year earlier, and the retailer predicted that 2008 will be a difficult year. Still, shares were up 1.1%.
Among commodities, crude oil was up 66 cents to $124.88 a barrel, and gold futures were off 20 cents at $866.30. The U.S. dollar slipped against both the euro and the yen.
Treasury prices were falling. The 10-year note dipped 3/32 in price to yield 3.93%, and the 30-year bond gave up 8/32 in price, yielding 4.63%.
Markets abroad were mixed. In Asia, Tokyo's Nikkei 225 added 0.9% overnight, but the Hang Seng Index in Hong Kong slipped 0.1%. As for European bourses, London's FTSE 100 climbed 0.2%. Germany's Xetra Dax and the Paris Cac, however, lost 0.3% and 0.1%, respectively.