Updated from 11:30 a.m. EDT
At the midday mark, the
Dow Jones Industrial Average
was climbing 43, or 0.41%, to 10,585, with retail and financial components faring better ahead of the tomorrow's
Federal Reserve Board
announcement on interest rates. The
Nasdaq Composite Index
however, was essentially flat, down 9, or 0.23%, to 3903 amid jitters about earnings pre-announcements.
was recently higher, up 4 to 1459. The
was slipping 3 to 513, while
TheStreet.com Internet Sector
index was adding 10, or 1.25%, to 829.
Lately, retail stocks were being bought up, as investors lifted the sector, confident the Fed does not have a rate increase included in the Federal Open Market Committee agenda during its meeting today and tomorrow. The
S&P 500 Retail Index
was bouncing 23, or 2.8%, to 845, with
up 4.5% and
Any changes in monetary policy won't be announced until tomorrow around 2:15 p.m.
was lifting 1 15/16 to 120 3/8, while investment bank
was up 3/16 to 87 15/16.
"I think that they're just marking them a little bit," said Patrick Boyle, director of trading at
Credit Suisse First Boston
, referring to the financial sector. "We're seeing some short covering ahead of Greenspan's comments. The consensus is that Greenspan isn't going to raise rates, but the minutes will tell a lot. "
"We're probably going to flip-flop around for the next few days. It might try to rally, though. Either the Fed has one more move or they're done," Boyle said.
After yesterday's rally, widespread expectations the Fed the will hold off on interest rates this month may already be priced into the market. Meanwhile, jitters are rising over what the Fed will say about upcoming months in a statement accompanying its rate hike decision tomorrow. And concerns over weakness in this quarter's corporate earnings are growing.
All eyes are on telecom today, after the
Department of Justice
announced this morning that it filed a suit to halt the planned $120 billion merger between
. Lately, Sprint was up 0.42%, while WorldCom was climbing 2 5/16, or 6.17%, to 39 13/16. According to the Justice Department, the merger would mean higher prices for customers.
Elsewhere in tech,
was slipping 3.2% after Merrill Lynch analyst Steve Milunovich lowered his second-quarter revenue growth outlook to 1% from 3% due to the impact of currency and a softer-than -expected rebound in the services business.
With earnings season just on the horizon, some Wall Street insiders are chalking up today's tepid Nasdaq action to the pre-announcement warnings that hit the market just weeks before their stocks are set to report. "People are focusing on earnings now," said Tony Dwyer, chief market strategist at
. "We're not seeing a huge amount of interest because people are afraid that they'll walk in tomorrow and see their company pre-announce.
Communications equipment maker
was providing some excitement, after it warned late yesterday that it would miss second quarter earnings estimates. The stock was recently plummeting 16 3/4, or 41%, to 24 1/16.
A cooler-than-expected June
Consumer Confidence Index
, released at 10:00 a.m. EDT, didn't really move the market. The number came in at 138.8 versus
consensus estimates of 140.1 and May's revised 144.7. Not a big market mover, consumer confidence is nonetheless used to gauge consumer moods and should give some clues to future consumer spending patterns.
Once this week's Fed meeting is done, the market could lose some steam as it looks ahead to the next Fed meeting and begins to worry about June economic data. Several Fed governors have indicated in recent statements that they aren't yet convinced the slowdown indicated by May data is for real.
For a look at stocks to watch today, see Stocks to Watch, published separately.
Breadth was mixed on tepid volume.
New York Stock Exchange: 1,554 advancers, 1,152 decliners, 489 million shares. 49 new 52-week highs, 35 new lows.
Nasdaq Stock Market: 1,684 advancers, 1,986 decliners, 729 million shares. 49 new highs, 62 new lows.
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Most Active Stocks
NYSE Most Actives
- Motorola (MOT) : 11 million shares.
Philip Morris (MO) - Get Report: 10.2 million shares.
Nokia (NOK) - Get Report: 9.3 million shares.
Nasdaq Most Actives
- Worldcom (WCOM) : 25 million shares.
Cisco (CSCO) - Get Report: 16.1 million shares.
Harmonic (HLIT) - Get Report: 15.8 million shares.
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The transports and financials were showing strength, with the
Dow Jones Transportation Average
up 1.78% and the
Nasdaq Financial-100 Index
Biotechs were suffering, however, with the
Nasdaq Biotechnology Index
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Treasuries are languishing this morning despite a weaker-than-expected report on consumer confidence. The launch of a very large multi-currency bond issue by
may be prompting selling of Treasuries as a hedge by underwriters or by investors in order to raise cash to buy the new issue.
Deutsche Telekom started taking orders on a bond issue totaling $13.5 billion at current exchange rates. It comprises $9 billion of five-, 10- and 30-year dollar-denominated bonds, the equivalent of $2.6 billion of five- and 10-year euro-denominated bonds, the equivalent of $1.125 billion of five- and 30-year bonds in sterling and the equivalent of $806 million of five-year bonds in yen.
The benchmark 10-year Treasury note was up 3/32 at 102 29/32, yielding 6.097%.
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The major European markets were mixed at the close of their trading session as they await the U.S. Fed decision tomorrow.
was down 29.90, or 0.4%, to 6375.30.
Across the channel, Frankfurt's
was up 15.93, or 0.2%, to 7043.12, while the Paris
was off 18.17, or 0.2%, to 6568.09.
The euro was lately staying put at $0.9402.
Asian markets closed higher overnight on optimism that the U.S. Federal Open Market Committee will leave interest rates where they currently stand.
Tokyo stocks gathered momentum as the day wore on, lead by strength in high-technology issues, and the
index closed up 353.66, or 2.09%, to 17279.06.
The greenback climbed higher against the yen to fetch 105.67, as talk continued in the foreign exchange market that
Moody's Investors Service
may soon downgrade Japan's sovereign debt rating. The dollar was recently lower at 105.55 yen.
Hong Kong investors were more cautious, and volume remained light, but the
index still closed higher 176.86, or 1.11%, to 16155.77.
Elsewhere in Asia, Korea's
index gained 18.32, or 2.31%, to 809.87, while Taiwan's
index lost 105.39, or 1.24%, to 8424.17.
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