- The Washington Times - Monday, November 10, 2003

NEW YORK (AP) — Wall Street pulled back yesterday as wary investors decided to cash in recent gains despite upbeat news about IBM Corp. and Intel Corp.

Analysts said many investors were again questioning stock valuations after several weeks of advances. A suicide car bombing in Saudi Arabia that killed 17 persons over the weekend also weighed on stocks.

“People are being guarded,” said Paul McManus, senior vice president and director of research at Independence Investment LLC. “People are looking at the market and wondering, ‘Have I missed the rally, can I continue to be aggressive at these levels?’”

The bombing in Saudi Arabia “also was somewhat disconcerting,” he said. “People might try to assess how bad it can get or whether it portends anything further.”

The Dow Jones Industrial Average closed down 53.26, or 0.5 percent, at 9,756.53.

The broader market also retreated. The Nasdaq Composite Index declined 29.10, or 1.5 percent, to 1,941.64 after a weekly advance of 2 percent. Analysts said the technology-dominated index took a greater fall because it has had the biggest gains.

The Standard & Poor’s 500 index fell 6.10, or 0.6 percent, to 1,047.11.

Yesterday, the United States said it would help Saudis with its war on terror after the bombing of a Riyadh housing complex. Saudis blamed the attack on al Qaeda terrorists.

IBM Corp. gained $1.69 to $89.95 after Barron’s published a cover story saying the company should benefit from a rebound in corporate computer spending.

But Intel fell 48 cents to $33.39 even though J.P. Morgan Securities raised the chip maker’s stock rating to “overweight” from “neutral.”

Investors have sent stocks higher in recent weeks on optimism for a strong economic recovery. But with the earnings season winding down and stocks near 52-week highs, investors have little motivation to push the market significantly higher, analysts said.

Since hitting a low on March 11, the Dow has gained 30 percent, the Nasdaq is up 53 percent, and the S&P; has risen 31 percent.

“The early portions of the economic recovery are already priced into the markets,” said Subodh Kumar, chief investment strategist for CIBC World Markets. He believes the main gauges will be confined to a trading range for the next several months, with the S&P; hitting an upper range of 1,075, the Dow possibly reaching 10,000 and the Nasdaq hovering near the 2,000 mark.

“For investors, sideways and range-bound trading after the strong upswing of the last year is actually quite healthy, I think,” Mr. Kumar said.

Tyson Foods Inc. rose 24 cents to $14.47 after the meat and poultry processor reported quarterly earnings that beat Wall Street’s estimates.

Decliners included R.R. Donnelley & Sons Co., which fell $1.47 to $26.56 after the commercial printer said it would acquire Canadian printer Moore Wallace Inc. for $2.8 billion.

Declining issues outnumbered advancers about 2 to 1 on the New York Stock Exchange. Consolidated volume was light at 1.58 billion shares.

, compared with 1.83 billion traded Friday.

The Russell 2000 index, which tracks smaller-company stocks, fell 9.75, or 1.8 percent, to 533.21.

Overseas, Japan’s Nikkei stock average finished 1.2 percent lower. In Europe, France’s CAC-40 declined 0.8 percent, Britain’s FTSE 100 was down 0.8 percent and Germany’s DAX index dropped 1 percent.


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