- The Washington Times - Thursday, July 17, 2008

NEW YORK (AP) – Stocks traded mixed Thursday as investors parsed stronger-than-expected quarterly reports from JPMorgan Chase & Co. and United Technologies Corp. that gave Wall Street some reassurance about the health of the economy. But a rise in oil prices appeared to erode some of the enthusiasm.

The major indexes at times dipped into negative territory but advancing stocks outnumbered decliners on the New York Stock Exchange. The modest moves come a day after falling oil prices and surprising bank results swept Wall Street to a huge rally.

A flurry of quarterly results are offering investors some insights into the well-being of the economy. Three components of the Dow Jones industrial average Coca-Cola Co., JPMorgan Chase & Co. and United Technologies Corp. issued comments that generally indicated that their businesses are holding up despite sometimes difficult economic conditions.

Wall Street also appeared placated by economic figures. A Commerce Department report showed construction of homes and apartments rose in June by 9.1 percent.

The gain follows a change in New York laws that has given a boost to apartment building. Construction of single-family homes fell by 5.3 percent to the slowest pace in 17 years. Applications for building permits, one indicator of future activity, rose by 11.6 percent.

The reports arriving Thursday at times investors put aside some of their worst fears about the economy. To be sure, many companies have yet to report quarterly results and there are still trouble spots, such as the banking sector.

But oil prices rebounded after trading lower early Thursday. Light, sweet crude rose $1.27 to $135.87 on the New York Mercantile Exchange. Oil fell more than $4 Wednesday and more than $6 Tuesday, offering investors some hope that perhaps commodity prices will begin to decline.

In late morning trading, the Dow rose 5.62, or 0.05 percent, to 11,344.90 after jumping more than 110 points early in the session. The Dow on Wednesday surged 276 points, or 2.5 percent, logging its best daily gain in three months.

Broader stock indicators declined Thursday. The Standard & Poor’s 500 index fell 3.31, or 0.27 percent, to 1,242.05, and the Nasdaq composite index declined 9.91, or 0.43 percent, to 2,274.94.

Advancing issues outpaced decliners by about 3 to 2 on the New York Stock Exchange, where volume came to 468.2 million shares.

Stocks soared Wednesday after better-than-expected quarterly results from Wells Fargo & Co. helped ease some of investors’ worries about the health of the banking sector. Wall Street has grown concerned that souring mortgage debt would force some banks to go under.

Bond prices declined Thursday as investors turned away from the safety of government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.98 percent from 3.94 percent late Wednesday.

The dollar was mixed against other major currencies, while gold prices rose.

A drop in oil or even oil remaining off its highs would be welcome news for nearly all parts of the economy. Consumers, in particular, have been hard-pressed by higher fuel and food costs. Wall Street is worried they will pare their spending on discretionary items to make room in their budgets for the higher-priced necessities. A pullback could be troublesome as consumer spending accounts for more than two-thirds of U.S. economic activity.

In other economic news, the Labor Department reported that the number of newly laid-off people seeking unemployment benefits rose by 18,000 last week to 366,000. However, the increase was below the number economists expected.

Investors appeared undeterred by a reading from the Philadelphia Federal Reserve showing another decrease in regional manufacturing.

The Russell 2000 index of smaller companies fell 2.31, or 0.34 percent, to 684.44.

Overseas, Japan’s Nikkei stock average closed up 1.00 percent. In afternoon trading, Britain’s FTSE 100 jumped 2.93 percent, Germany’s DAX index rose 2.30 percent, and France’s CAC-40 surged 3.12 percent.

On the Net: New York Stock Exchange: http://www.nyse.com Nasdaq Stock Market: http://www.nasdaq.com

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