- The Washington Times - Tuesday, December 2, 2003

NEW YORK (AP) — Investors retreated modestly on Wall Street yesterday, collecting profits after a six-day advance in the Dow Jones Industrial Average. Analysts called the pullback unsurprising, especially after the Dow’s 116-point advance on Monday.

The market also lacked the kind of galvanizing news that sent stocks surging in the previous session — encouraging economic data and solid news from retailers about Thanksgiving weekend sales.

“After a run-up like we saw Monday, it’s normal for people to say, ‘I don’t want to pay those prices, I’m going to pull back,’” said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee.

The Dow closed down 45.41, or 0.5 percent, at 9,853.64. During the previous six trading days, the blue chips gained 279.63.

The broader market gauges also closed lower. The Nasdaq Composite Index ended the day down 9.75, or 0.5 percent, at 1,980.07. The Standard & Poor’s 500 index lost 3.50, or 0.3 percent, to close at 1,066.62.

The market rallied Monday after the Institute for Supply Management reported better-than-expected growth in the nation’s manufacturing sector and retailers said they had a successful first weekend of the holiday shopping season. Many analysts were optimistic that the gains would hold despite Tuesday’s dip, and they noted that the end of the year is traditionally a time of strength for Wall Street.

“I don’t think investors are comfortable being on the sidelines at this point,” said Richard E. Cripps, chief market strategist for Legg Mason of Baltimore. “For those people who were saying the market was due for a correction … this is a real decision time.”

Still, some investors remain skeptical about the strength of the recovery and might be inclined to guard their gains.

Viacom Inc. gained 7 cents to close at $39.64 after news it was nearing a decision to sell its majority interest in video-rental company Blockbuster Inc. UBS rated Viacom at a “buy” after the Wall Street Journal reported the company was poised to unload the unit. The video-store chain lost 29 cents to close at $16.94.

AT&T; Corp. ended the day down 8 cents at $20.27 after Betsy Bernard stepped down as president to pursue other opportunities. The company named William J. Hannigan, chairman and chief executive of Sabre Holdings Corp., to succeed her.

PepsiCo Inc. declined 57 cents to $48.14 after announcing it would cut 750 jobs and close a Frito-Lay plant in Louisville, Ky., as part of a plan to streamline its operations. The soft-drink and snack-food company reaffirmed its outlook through the end of the year and forecast double-digit growth in earnings per share for 2004.

Advancers slightly outnumbered decliners on the New York Stock Exchange. Volume was light, with 1.38 billion shares traded.


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