NEW YORK (
) -- Stocks finished mixed Tuesday as the
Dow Jones Industrial Average
saw its latest run of four straight positive sessions come to an end. Optimism about the tech sector, however, was sufficient to keep the Nasdaq in positive territory. Just barely.
After running more than 40 points higher at its peak for the day, the Dow sold off in the last hour and closed down almost 18 points, or 0.2%, at 10,526. The
came impressively close to being flat, falling less than a point to finish at 1,121, while the
managed a gain of 4 points to 2,290.
Breadth for the Dow was mixed with 16 of the blue-chip index's 30 components finishing lower. The laggards were led by
Bank of America
said it plans to identify tens of billions of dollars in assets and businesses that it wants to sell or wind down as it tries to ease investors' concerns about its holdings of risky securities and loans on its $2.3 trillion balance sheet.
Reflecting investor faith in the techs,
were the Dow's biggest gainers.
HP shares jumped 2.6% to close at $39.29, as its recent buying spree fueled speculation that more acquisitions could be on the horizon.
Cisco shares tacked on almost 1% after CEO John Chambers said the networking giant would start paying a dividend this year.
Retail sales for August rose 0.4%, the Commerce Department said early Tuesday. That was higher than the 0.3% uptick analysts expected, boosting investor sentiment.
"The numbers, while better-than-expected, were not good enough to generate confidence about a rebound in the economy," said FTN Financial economist Chris Low, noting that there was weakness across the board in housing-related numbers. While there was strength in clothing -- the first gain since February -- that too was driven by aggressive discounting. "In the final analysis, it was not a report that pointed to a double-dip recession, but not one that pointed to growth that could generate employment either," he added.
said sales for the all-important back-to-school selling season exceeded company projections, lifting the retailer's shares 7.5% to close at $24.01.
shared a similar sentiment while
J. Crew Group
was not as confident. Teen retailer
was one of the sector's biggest gainers Tuesday, rising 16% at the closing bell, after it raised its third-quarter profit and sales outlook. The
S&P Retail Select Industry Index
closed up 1.8%.
pushed back its outlook for a robust recovery by six months, citing delays in housing and unemployment recovery as the reason it now expects a meaningful recovery in the second half of 2011. Lowe's shares edged 0.8% lower to close at $21.53.
In economic news, business inventories positively surprised, climbing 1% in July from the previous month and 2.4% year-over-year, the Commerce Department said. That was more than the 0.7% climb analysts expected and was the biggest gain in two years. Changes in business inventories are used by economists to get a reading on industrial production data, information due to be released later this week.
FTN Financial's Low said growth in business inventories was somewhat of a mixed blessing. "It should contribute to stronger GDP growth in the third quarter," he said, but added that the Institute for Supply Management survey showed that customer inventory levels were starting to reach uncomfortable levels. "The inventory building is not entirely voluntary and we might see some weakness going ahead."
Weak economic data out of Europe cast a shadow on the positive stateside news flow. Industrial production for the 16 nations that use the euro as currency was flat in August, lower than the 0.2% increase predicted, acting as further confirmation that growth in the region would slow in the second half of 2010. Investor confidence in Germany sunk to a 19-month low of negative 4.3 in September, far below the forecast for a reading of 10, according to the ZEW Center for Economic Research. In the U.K., inflation rose 3.1%, higher than the forecast for 2.9%.
The FTSE in the U.K ended flat, while the Dax in Germany closed 0.2% higher.
In U.S. corporate news, a few more earnings rolled in ahead of the opening bell Tuesday.
shares closed up 5.9% after the electronics retailer grew profits by 62% to 60 cents per share, beating expectations, and raised its full-year outlook by 10 cents.
beat expectations with earnings of 41 cents per share, leading shares higher by 1%.
shares fell 3.1% to $39.42 after warning its third-quarter results would come in below expectations.
In other corporate news,
said it plans to sell debt this year to support a higher quarterly payout and ramp up repurchase activity as too much of its cash is held overseas. The stock dipped into negative territory, down 0.3% at the closing bell to $25.03.
rose 5.1% to close at $11.19 after the aircraft carrier said it expects strong margins and unit revenue for the current quarter.
fell 1.9% after saying another top executive will step down following the appointment of a new CEO. The firm also launched three new smartphones on Tuesday.
shares plummeted 39.7% on more than seven times their average trading volume, closing at $4.13, after the
U.S. Food and Drug Administration raised safety concerns about its diet drug lorcaserin.
American International Group
traded lower by 2.2% after saying the insurer was in talks with the U.S. government to speed up an exit plan designed to repay U.S. taxpayers.
added 0.1% after the KFC and Taco Bell operator hiked its quarterly dividend by 19% to 25 cents per share.
In M&A news,
Green Mountain Coffee Roasters
lost 1.8% after announcing it would acquire gourmet coffee roaster
for $890 million.
shares lost 7.7% after saying it agreed to buy health care supply chain management provider
for $850 million in cash. The stock was down 4.3% to $20.41.
In commodity markets, the
December gold contract hit a record intra-day high of $1,276.50 an ounce on Tuesday, $10 higher than its previous high set in June. The metal settled $24.60 higher at $1,271.70 an ounce -- a record closing high.
Crude oil for October delivery cooled off to trade 40 cents lower at $76.79 a barrel.
The benchmark 10-year Treasury note was up by 22/32, diluting the yield to 2.666%.
Meanwhile, the dollar was trading lower against a basket of currencies, with the dollar index down by 0.9%. The Yen touched a 15-year high against the dollar on Tuesday.
Asian markets ended on mixed note on Tuesday. Japan's Nikkei finished 0.2% lower as investors awaited the results of Japan's elections.
Japanese Prime Minister Naoto Kan survived a challenged to his leadership and was re-elected president of the ruling Democratic party on Tuesday. The results came after market hours. Hong Kong's Hang Seng Index rose 0.2%.
--Written by Shanthi Venkataraman and Miriam Marcus Reimer in New York
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.