- The Washington Times - Tuesday, January 6, 2004

NEW YORK (AP) — Wall Street stalled yesterday in quiet trading as investors booked profits from the New Year’s rally and searched for new reasons to buy. Prices closed narrowly mixed, with technoogy stocks showing the biggest gains.

Some selling had been expected following the big advance a day earlier, and analysts said the absence of vigorous buying did not mean the market, which has been gradually moving higher since late 2003, was losing momentum.

“What you’re seeing is a slight pause in what is still an upwardly biased market,” said Brian Bush, director of equity research at Stephens Inc. “And I expect to see more upside.”

The Dow Jones Industrial Average closed down 5.41, or 0.1 percent, at 10,538.66, maintaining nearly all of the 134-point surge on Monday that led it to its highest close since March 2002.

The market’s broader indicators were higher. The Nasdaq Composite Index closed up 10.01, or 0.5 percent, at 2,057.37. The advance added to the 2 percent gain Monday, and was the index’s highest close since Jan. 4, 2002.

The Standard & Poor’s 500 Index rose 1.45, or 0.1 percent, to 1,123.67.

The market shrugged off a Commerce Department report of a 1.4 percent decline in November in orders to U.S. factories. It was the biggest setback for orders in seven months, but analysts discounted the numbers as a blip in a generally improving economic outlook.

Brian Williamson, an equity trader at the Boston Company Asset Management, said investors are now focused on the future, and identifying the next catalysts for a rally.

He said Wall Street would be closely watching new job data and retail sales figures expected later this week. After that, the attention is likely to be on how many companies warn of earnings disappointments or revise fourth-quarter forecasts upward ahead of actual reports later this month.

“We need to see more positive stories from companies, we need to see the shape of the economy improving,” Mr. Williamson said. “In order to keep this going, we’re going to need good jobs numbers, good figures from retailers and good earnings.”

Sun Microsystems closed up 33 cents, or 7 percent, at $5.03 on an encouraging research note from Merrill Lynch about the computer-and-software maker.

Shares of Gateway Inc. fell 64 cents to $4.34 a day after the computer company reduced its fourth-quarter-revenue forecasts because of low inventory on some products and pricing competition among PC makers.

Other computer makers also pulled back, including Dell Inc., which dropped 16 cents to $35.06.

U.S. automakers slipped a day after reporting they had lost more ground to foreign carmakers during 2003. General Motors Corp. dropped 33 cents to $54.26, while Ford Motor Co. lost 5 cents to $16.54.


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