Stocks End Narrowly Mixed

The Dow nearly erases all its losses and closes above 11,000 again.
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Updated from 4:11 p.m. EST

A late surge nearly allowed blue chips to erase all their losses Tuesday, but the early weakness spurred by a handful of profit warnings and a weak quarter at

Alcoa

(AA) - Get Report

proved too much to overcome. Tech stocks did manage to break into positive territory.

The

Dow Jones Industrial Average

finished the day down 0.32 points but closed above 11,000 for the second straight day. The Dow stood at 11,011.58 at the close, well above its session low.

The

S&P 500

slipped 0.46 points to 1289.69, and the

Nasdaq Composite

edged up 1.63 points, or 0.07%, to 2320.32.

"The bears tried to take control today but were unable," said Barry Hyman, equity market strategist with Ehrenkrantz King Nussbaum. "On the backs of good buying in the technology sector, we're seeing investors take more risk. It's a good sign the market didn't give up any of its gains."

Stocks were coming off a rousing session in which the Dow, paced by a nearly 8% run in

General Motors

(GM) - Get Report

, pushed past 11,000 for the first time since June 2001. The Dow, S&P 500 and Nasdaq all began trading Tuesday at their best levels in more than four years.

"We have an excuse to take some profits and watch the market consolidate after the recent run-up to start the year," said Peter Cardillo, chief market analyst with S.W. Bach & Co. "This consolidation is a good sign, though. Hopefully we can watch the market continue its upward momentum later."

Alcoa fell 3.2% after saying fourth-quarter earnings dropped to $224 million, or 26 cents a share, from $268 million and 30 cents a share in the year-ago period. Adjusted earnings of 35 cents a share were 2 cents below Wall Street estimates. Alcoa was lower by 97 cents to close at $29.60.

Paul Mendelsohn, chief investment strategist with Windham Financial, attributed the move partly to profit-taking. "Investors appear to be once again concerned that earnings growth may be slowing, after Alcoa reported that net income fell by 16%," he said.

About 1.73 billion shares traded on the

New York Stock Exchange

, with advancers beating decliners by a 6-to-5 margin. Trading volume on the Nasdaq was 1.99 billion shares, with advancers outpacing decliners 3 to 2.

In other markets, the 10-year Treasury was down 15/32 in price to yield 4.43%, 3 basis points above the two-year note, while the dollar was higher against the yen and lower against the euro.

Oil, which fell 81 cents in the prior session as warm-weather forecasts beat back the bulls, finished lower again. Crude for February delivery closed down 13 cents to $63.37 a barrel in Nymex floor trading, having threatening another four-month high early in the session. Natural gas futures were down 2 cents at $9.34 per million British thermal units.

To view Gregg Greenberg's video wrap on today's market, click here

.

By sector, the Philadelphia Oil Service index gained 2.1%, the Amex Oil index was up 1%, and the Philadelphia Housing Sector index added 1.2%. Meanwhile, the Amex Airline index lost 1.3%

Two other Dow components were big movers Tuesday. One is GM, which is facing a call for a lower dividend from a representative of major shareholder Kirk Kerkorian in Detroit on Tuesday. The other is

United Technologies

, which was downgraded to neutral by CSFB Tuesday on the basis of valuation.

GM had briefly turned positive after the company said it would cut sticker prices in 2006 before closing lower. The stock finished down 35 cents, or 1.6%, to $22.06. United Technologies tacked on 4 cents, or 0.1%, to close at $56.84.

Phelps Dodge

(PD) - Get Report

slashed its fourth-quarter earnings outlook by over 75%, citing reductions in production and sales of copper and molybdenum. The copper miner now expects earnings of $1 to $1.30 per share, down from its prior outlook of $4.15 to $4.40. The stock dropped $7.97, or 5.2%, to $146.58.

Bucking the downtrend was

Apple Computer

(AAPL) - Get Report

, whose shares reached a 52-week high after the company said it sold 1.25 million computers and 14 million iPods during the fourth quarter. That will push revenue to $5.7 billion, well above current Thomson First Call estimates of $5.04 billion. The company also unveiled its new MacBook Pro and iMac computers featuring

Intel's

Core Duo chip.

Apple gained $4.81, or 6.3%, to $80.86. Intel fell by 35 cents, or 1.3%, to $26.11.

Wyeth

(WYE)

expects to earn $3.09 to $3.22 a share next year, excluding stock options, up about 10% from the comparable 2005 profit. The Thomson First Call 2006 consensus on Wyeth is $3.16 a share. Wyeth rose 29 cents, or 0.6%, to $47.81.

Home Depot

(HD) - Get Report

said it agreed to acquire construction materials wholesaler

Hughes Supply

(HUG)

for $46.50 a share, a 21% premium to Hughes Supply's Monday close. Home Depot added 96 cents, or 2.4%, to $41.78. Hughes surged $7.06, or 18.3%, to $45.61.

Retail drug chain

Rite Aid

(RAD) - Get Report

said same-store sales were up 3.9% in December. Pharmacy same-store sales rose 4.5%, and same-store sales for other goods were up 3%. Total sales for month rose 26.2% from a year ago to $1.80 billion. Rite Aid gained 12 cents, or 3.4%, to $3.70.

OfficeMax

(OMX)

announced plans to close 110 U.S. stores by the end of the first quarter in a new restructuring effort. The office-supplies retailer will also close its wood-polymer building materials facility. OfficeMax expects to record charges of $187 million. Shares were up 13 cents, or 0.5%, to close at $26.66.

Among brokerages, Morgan Stanley raised its rating on the semiconductor sector to attractive from in line, based on valuation. The firm also upgraded

Applied Materials

(AMAT) - Get Report

to overweight from equal weight, raising the target to $23 from $17.50. Meanwhile,

Novellus Systems

(NVLS)

was downgraded to underweight from equal weight, as the firm sees profitability issues for the semiconductor maker.

Applied Materials closed up 27 cents, or 1.4%, to $19.79. Novellus lost 77 cents, or 3%, to $25.03.

After the bell,

Genentech

(DNA)

is expected to post fourth-quarter earnings of 34 cents a share. The stock was higher by 69 cents, or 0.7%, to $93.35.

The retreat in U.S. stocks hit overseas markets. In London, the FTSE 100 was down 0.7% to 5690, while Germany's Xetra DAX was losing 0.8% to 5494. In Asia, Japan's Nikkei swooned 1.9% overnight to 16,124, while Hong Kong's Hang Seng dipped 0.1% to 15,570.