Updated from 3:08 p.m. EST
A day before the presidential election, stocks on Wall Street closed narrowly mixed, as traders took in fresh updates on the state of the credit crisis and digested some bearish economic data.
Dow Jones Industrial Average
slipped 5.18 points, or 0.1%, to 9318.83, and the
ended down 2.45 points, or 0.3%, at 966.30. The
gained 5.38 points to 1726.33.
The election is potentially significant in that there's a chance that Democrats will control the House, the Senate and the presidency, said Alan Gayle, senior investment strategist at RidgeWorth Capital Management. "The market would be very happy if we had gridlock, because that would reduce the chances that there would be significant rule changes," said Gayle.
However, said Gayle, "I think to a certain extent the pervasiveness of the financial crisis has probably had a more dominant impact on investing leading up to the election and will continue over the near term." He said that performance by health-care stocks, which would typically decline in anticipation of Democratic rule, have lately held up relative to the major averages because they are defensive against a downturn.
Financial-sector turmoil continued to hold investors' attention.
The Wall Street Journal
reported that as many as 1,800 public companies could be signing up for investments by the
Meanwhile, leveraged-buyout firm
was delaying plans to come public as the credit crisis hurt its capitalization standing. KKR said in a statement it would hold off on buying Amsterdam-listed
KKR Private Equity
until next year.
Hartford Services Group
said in a filing with the
Securities Exchange Commission
that it had more than enough capital to keep its double-A credit rating at year-end. Shares rocketed 58% to $16.28.
Moody's Investors Service on Monday downgraded Hartford's senior unsecured debt rating and its short-term debt rating. Moody's said that Hartford's third-quarter earnings, along with weakness in debt and equity markets, were cause for concern.
said it received preliminary approval to sell $6.6 billion in preferred stock and related warrants to the Treasury under the auspices of the Troubled Asset Relief Program. Shares edged up 1.6% to $30.30.
The Treasury announced in a statement that it predicts it will borrow $550 billion in marketable debt for the fourth quarter. The estimate exceeds the Treasury's July estimate by $408 billion. The increase in borrowing is due mainly to "economic assistance programs, lower receipts, and lower net issuances of State and Local Government Series securities," the Treasury said.
Credit markets were loosening. Three-month dollar Libor, a measure of the rate banks charge one another for large loans, was down 17 basis points to 2.86%. Overnight Libor slipped 2 basis points to 0.39%.
However, a survey by the
showed that credit was still difficult to come by. The Fed reported that 85% of U.S. banks were tightening lending standards for commercial and industrial loans over the past three months, up from 60% in its July survey.
Agricultural products maker
announced its intent to buy Brazilian firm
for $290 million. Monsanto lost 1.8% to $87.34.
Less fortunate among agricultural names was
( VSE), which said late Friday it was filing for Chapter 11 bankruptcy protection. Shares plummeted 52% to 23 cents.
Back in merger news,
The Detroit News
, which owns
, has ceased discussions with
because Cerberus intends on merging with
. GM stock tumbled 2.4% to $5.65.
Automakers were also releasing October sales results. GM reported that its sales declined 45% for the month.
announced that its October sales declined 30 percent from a year ago.
experienced a sales decline of 23% for the month. Ford lost 2.7% to $2.13, and Toyota gained 0.8% to $76.66.
announced that it would close 155 of its U.S. stores and cut down on its planned openings as it considers its options regarding a restructuring. Shares added 36% to 35 cents.
announced it would invest $1 billion in China over the next four years in an effort to gain a foothold in emerging markets. The stock added 0.8% to $57.47.
announced that a strike by the International Association of Machinists had ended after the company and union signed a four-year contract. Shares tacked on 0.8% to $52.85.
As for earnings, insurer
( PMI) reported a wider third-quarter loss, and
announced a decline in quarterly profit. PMI gained 4% to $2.59, and Goodyear added 5.4% to $9.40.
In terms of economic data, the Census Bureau reported that construction spending for September declined 0.3%. Economists were expecting spending to decrease by 0.8%.
The Institute for Supply Management's October manufacturing index showed a reading of 38.9, down from 43.5 in September and below economists' forecast of 42.
Ian Shepherdson, chief U.S. economist for High Frequency Economics, wrote in an email that the ISM index's decline marks its lowest reading since September 1982, and that its decline reflects that orders, production and employment have dropped sharply to deep recession levels. "The key issue now is just how much of
this plunge in activity reflects the shock of the market meltdown and how much will be sustained. We think there will be a modest bounce next month but the trend is horrific," he wrote.
"Clearly, the reading at 38.9 is very weak," said Gayle of RidgeWorth. He also said that there is a mitigating factor in the bearish data in that overall inventories are not excessive. Whereas in the past, businesses might have been slower to respond to declines in consumer spending, manufacturers have been quicker to respond to the negative environment, he said. "I don't think that number carries the implication of protracted weakness that it has in previous decades or previous cycles."
The European Commission also reported that Europe is probably in a recession and will continue to struggle through the next year.
Shifting to commodities, crude oil lost $3.90 to close at $63.91 a barrel. Gold climbed $8.60 to settle at $726.80 an ounce.
Longer-dated U.S. Treasury securities were mixed. The 10-year was up 14/32, yielding 3.91%. The 30-year was down 5/32 to yield 4.34%. The dollar was gaining on the yen, euro and pound.
Abroad, European exchanges were edging higher, as the FTSE in London and the Dax were logging gains. In
, Japan's Nikkei was closed for a holiday, while Hong Kong's Hang Seng finished on the upside.