- The Washington Times - Tuesday, April 15, 2008

From combined dispatches

NEW YORK (AP) — Stocks finished a quiet session moderately lower yesterday as investors grappled with concerns about the health of corporate profits after Wachovia posted disappointing quarterly results.

Investors paused after a sell-off Friday and ahead of a raft of quarterly results and economic data arriving this week.

Wachovia surprised investors by posting a first-quarter loss of $393 million and cutting its quarterly dividend by 41 percent to 37.5 cents. The bank, which analysts had expected to post a profit, also said it plans to raise $7 billion through a stock offering.

But investors appeared to find some encouragement in the session from a better-than-expected report on retail sales.

“We obviously came out with more bad financial news,” said Ryan Detrick of Schaeffer’s Investment Research, referring to the Wachovia report. “The flip side is we had retail sales come in a little better than expected. It seems like they kind of negated each other.”

The Dow Jones Industrial Average fell 23.36, or 0.19 percent, to 12,302.06.

The Standard & Poor’s 500 Index fell 4.51, or 0.34 percent, to 1,328.32, and the technology-laden Nasdaq Composite Index fell 14.42, or 0.63 percent, to 2,275.82. The Russell 2000 Index of smaller companies dropped 0.3 percent to 686.07.

Bond prices edged lower. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.51 percent in late trading from 3.48 percent late Friday.

Light, sweet crude rose $1.62 to settle at a record $111.76 per barrel as the dollar fell, helping drive prices higher.

Gold prices turned higher, and the dollar was mixed against other major currencies.

Investors sold off shares of financials, led by Wachovia, which fell $2.26, or 8 percent, to $25.55. Citigroup Inc., which is due to report its quarterly results Friday, fell 85 cents, or 3.6 percent, to $22.51.

Mr. Detrick noted that the Wachovia news compounded investors’ concerns about the banking sector following a report Friday from General Electric Co. GE, seen as a bellwether of big business and the broader economy, said its financial services business was challenged in the first quarter by the slowing U.S. economy and difficult capital markets.

Meanwhile, Northwest Airlines pilots have threatened to oppose a combination with Delta Air Lines, but officials were nonetheless mobilizing to announce a deal to create the world’s biggest airline as early as today — provided the boards of the two companies give final approval to the deal, people familiar with the talks said Sunday. Northwest rose 26 cents to $11.22, while Delta advanced 47 cents, or 4.7 percent, to $10.48.

A rally in energy companies briefly led the market higher after oil prices advanced to a record, a government report showed gas-station receipts propped up sales at retailers last month, and the head of Brazil’s oil agency said the offshore Carioca prospect may be the world’s third-largest field.

Story Continues →