Wall Street's lackadaisical ways continued today as moderate volume, moderate movements and moderated sentiment were hallmarks of a relatively gloomy session. The bleakly uncertain earnings outlook and the optimism of future
Federal Reserve cuts have kept traders on the sidelines as the earnings season winds down this week.
Early-morning spikes in both the
Dow Jones Industrial Average and
Nasdaq Composite Index faded as the day wore on. The Dow dropped 66 to 10,881, continuing to chip away at Monday's 100-point gain. The Comp slid 46 to 2562, the fifth day of losses in seven sessions. Despite the lower finish, markets were generally directionless for much of the day.
Retailers got crushed as a mixed January sales report wasn't good enough to cheer up investors burned by a rotten Christmas. The
, two mall staples, warned that future earnings wouldn't match estimates, but that was offset by good news from
With the picture mixed, investors worried about the debilitating affect of discounting. The sales rack may be a good thing for shoppers, but companies make less money or even lose money by selling cheap to make room for spring fashions. Discounting can strip away excess inventory. But deep discounting can cut into profit margins. As a result of this unchecked fear, the
S&P Retail Index
It was led lower by industry heavyweight
. The blue-chip retailer announced today that January same-store sales rose 6%, and that net sales rose to $16.7 billion from $14.7 billion. But despite that apparently good news, Wal-Mart took a nosedive along with the rest of the sector. It fell $2.36 to $52.30 -- the third-biggest drag on the Dow.
, was another big Dow loser. It fell $1.79 to $43.99.
The retail sell-off turned into something of a mudslide, wiping out companies that make clothing and sneakers that end up on displays.
choked on mud.
were the two biggest Dow spoilers, keeping the index away from 11,000 for another session.
Technology still continued to stand dumbfounded in the wake of
earnings release after Tuesday's closing bell. Most sectors were within a percentage-point move of the break-even point as investors sort through the earnings season and try to spot winners.
Disk drive peripherals, those companies that make the gizmos that go with the technostuff you already own, were the only notable winner. The
American Stock Exchange Disk Drive Index
, a collection of these names, rose 1%.
Cisco was the most-actively traded stock on the Nasdaq and continued to get kicked in the teeth. It fell 3.4% to $30, making this the second-straight day of losses and the fourth losing session in five tries. This drags Cisco within a few cents of its 52-week-low of $29.88. It could have been worse. It could have been more like yesterday, where Cisco dropped 12% on 282 million shares traded. No, that's not a typo -- that's 282 million shares -- the second-most heavily traded single issue in Nasdaq history.
Other networking and networking-related names like
had also fallen by the day's close.
Other Nasdaq stocks were posting healthy gains.
, the second-most active stock, began trading today and rocketed up 29.2%.
Market Internals and Most Active Stocks
Volume was pretty moderate, as it has been for nearly every session in the past month or so. Honestly, is anyone really out there? Losers beat winners.
topped the NYSE after announcing that fourth-quarter earnings fell but 2001 would come in above expectations. Cisco rocked the Nasdaq for a second day, with KPMG Consulting a close second.
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Merger mania has been sweeping the airline industry.
are going to pick up
Trans World Airlines
, forming two massive airlines.
went on the record yesterday to tell the Senate Judiciary Committee that more mergers may need to occur to offset that consolidation of power.
, which owns American, dropped 4.1%.
, United's parent, fell 2.5% while Delta slid 1.7%.. The
American Stock Exchange Airline Index
The turbulent skies rattled the
Dow Jones Transportation Average
, which dropped 0.3%. Without the airline slump, transports would have fared much better today, with
up 4.1%, and
The best defense was to get out of defensive stocks. The
Philadelphia Stock Exchange Gold & Silver Index
fell 2.7%. The
S&P Chemical Index
fell 1.5%. And the
Philadelphia Stock Exchange Forest & Paper Products Index
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Treasury prices are lower in thin trading. The longer-dated securities are under greater supply-side pressure as the market awaits the auction of $10 billion worth of the 30-year bond. Dealers are selling in order to drive down the auction price.
The benchmark 10-year
Treasury note closed down 2/32 to 99 8/32, raising its yield to 5.097%.
In economic news, the
initial jobless claims
), which tracks the number of laid-off workers applying for unemployment benefits for the first time, rose for the third consecutive week. The bond market has already priced in this trend, however. There were 361,000 claims for the period ended Feb.3, up from 346,000 the previous week. Economists polled by
had forecast 348,000. The four-week moving average, considered the more reliable indicator of unemployment, rose to 331,250 from 327,000.
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reacted inversely to a widely expected interest rate cut this morning. The
Bank of England
lowered interest rates for the first time in 20 months, dropping them by a quarter point. London's
slid 10 to 6216.
In Paris, the
rose 32 to 5789 and the German
rose 57.9 to 6636.8.
The euro was lately trading at $0.9392.
Asian markets slipped overnight, with Japan's
closing down 1.7%, and Hong Kong's
off 0.9%. The Nikkei has been hit with substantial losses the past two years. It is at a 28-month low.
The dollar was trading at 114.95 yen.
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