Stocks Finish Mixed Amid ECB Speculation


NEW YORK ( TheStreet) -- U.S. stocks finished mixed Wednesday as traders mostly stood pat ahead of tomorrow's European Central Bank policy meeting.

It was a slow session filled with speculation about how ECB President Mario Draghi plans to address the old continent's debt problems and keep the single-currency eurozone intact. Bloomberg reported Draghi is set to propose a sterilized bond-buying program of unlimited size but the details of such a proposal and how it would actually be implemented remain to be seen.

The Dow Jones Industrial Average closed up more than 11 points, or 0.09%, at 13,047. The blue-chip index ranged less than 77 points on the day.

Winners outnumbered losers, 18 to 12, within the Dow. Walt Disney ( DIS), Boeing ( BA) and Alcoa ( AA) were the standout gainers, while American Express ( AXP), Cisco ( CSCO), and Kraft Foods ( KFT) were weak spots.

The S&P 500 fell 1.5 points, or 0.11%, to settle at 1403.44, while the Nasdaq gave back nearly 6 points, or 0.19%, to finish at 3069.

The weakest sectors in the broad market were transportation, technology and energy, while conglomerates, health care and basic materials were in the green.

Volume totaled 3.37 billion on the New York Stock Exchange and 1.49 billion on the Nasdaq.

"We move towards the ECB meeting tomorrow, with markets looking for reasons to be volatile," said Paul Donovan, global economist at UBS. "We expect the ECB to ease the refi (not the discount) rate and to give a broad outline of the bond buying program -- with the constraint that we still have the German court ruling the permanent European rescue fund ahead."

Capital Economics argued there's still potential for disappointment at tomorrow's policy meeting with the firm saying "the lack of a limit on bond buying could simply reflect unwillingness on behalf of the ECB to commit to a specific amount of purchases rather than anything bolder."

Wednesday's U.S. economic data was mildly positive. The Bureau of Labor Statistics provided a revised read on U.S. second-quarter nonfarm business productivity of up 2.2%, above the 1.8% gain expected by economists.

The report said the read on second-quarter unit labor costs was revised to a 1.5% increase, as expected. The previous read showed a 1.7% gain.

The data from across the pond was more troublesome. European Union's statistics office said Wednesday that retail trade in the region fell 0.2% in July from June as worsening economic conditions hurt consumer demand.

Also, Markit published data showing that its August composite PMI index on manufacturing and services declined to a revised 46.3, down from the flash reading of 46.6 and the July level of 46.5.

The FTSE in London pared losses, settling down 0.25%, while the DAX in Germany closed up 0.46%, gaining some strength on stimulus optimism. The Hong Kong Hang Seng index settled off 1.47% and the Nikkei in Japan finished down 1.09%.

The benchmark 10-year Treasury fell 6/32, raising the yield to 1.598%. The greenback slumped 0.12%, according to the dollar index.

October crude oil futures settled up 6 cents at $95.36 a barrel and December gold futures lost $2 to settle at $1,694 an ounce.

On the corporate front, FedEx ( FDX), the package delivery giant, said it now expects earnings of $1.37 to $1.43 a share in its fiscal first quarter ended in August, well below its original forecast for a profit of $1.45 to $1.60 a share.

FedEx said global weakness "constrained revenue growth at FedEx Express more than expected in the earlier guidance." Analysts were expecting earnings of $1.56 a share in the first quarter. The stock closed down 2%.

Facebook ( FB) CEO Mark Zuckerberg indicated he has no plans to sell any of his stock holdings in the social networking giant for at least 12 months. The shares rose nearly 5%.

Shares of Nokia ( NOK) tanked 16% on heavy volume after the company unveiled its Lumia 820 and 920 smartphones based on Microsoft's ( MSFT) Windows Phone 8 mobile operating system.

Guidewire Software ( GWRE ) shares leapt 10% after the provider of system software to the global property and casualty insurance industry reported fiscal fourth-quarter results that beat Wall Street's expectations.

Dollar General ( DG) hiked its full-year earnings guidance, after posting stronger fiscal-second quarter profit, as demand for basic goods and cheaper foods rose. The discount retailer also announced that its board has approved the buyback of up to an additional $500 million of its common stock. The stock added less than 1%.

Heckmann ( HEK) shares extended strong gains from the previous session, popping more than 4%, as investors stayed enthusiastic about the company's plan to purchase privately-held environmental services firm Power Fuels for about $380.5 million in cash and stock.


--Written by Andrea Tse in New York.

>To contact the writer of this article, click here: Andrea Tse.

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