- The Washington Times - Friday, February 10, 2006

NEW YORK (AP) — Stocks rebounded from an earlier decline to post moderate gains yesterday as investors looked past a mediocre outlook from Dow Jones industrial Pfizer Inc. and a record U.S. trade deficit. The major indexes finished the week mixed.

Pfizer’s profit warning dragged the Dow into negative territory for most of the day and added to traders’ concerns about weak overall corporate earnings in 2006 amid a slowing economy. A fourth straight record trade deficit of $725.8 billion last year also left Wall Street wondering whether rising energy and import prices could spark domestic inflation.

But the market managed to recoup its losses and pressed higher late in the day, giving the Dow a sturdy advance this week. Analysts have been expecting volatility among stocks following January’s rally and with no major events on the horizon to clarify investors’ uncertainty about the economy.

At the close, the Dow rose 35.70, or 0.33 percent, to 10,919.05, after losing as much as 63 points early in the session.

Broader stock indicators also reversed course to close higher. The Standard & Poor’s 500 index gained 3.21, or 0.25 percent, to 1,266.99, and the Nasdaq composite index advanced 6.01, or 0.27 percent, to 2,261.88.

Bonds pulled back from an early run-up, with the yield on the 10-year Treasury note jumping to 4.58 percent from 4.55 percent late Thursday. The two-year Treasury yield was up at 4.68 percent.

Meanwhile, the dollar was down against most major currencies, as gold prices plunged.

Crude futures slipped following a report suggesting that high prices were starting to stifle demand. The drop came even as concerns about political unrest in oil-producing countries persisted, with a barrel of light crude losing 78 cents to settle at $61.84 in New York.

This week, the Dow jumped 1.16 percent; last week, the index skidded 113 points after gaining 240 points the week before. The S&P; 500 added 0.23 percent and the Nasdaq declined 0.23 percent for the week.

Investors were unhappy with a lowered sales outlook for Pfizer’s top-selling Lipitor cholesterol drug. The company’s 2006 earnings forecast of $2 per share was 3 cents short of analysts’ estimates. Pfizer dropped 66 cents to $25.68.

Rival drugmaker and fellow Dow component Merck & Co. fell 3 cents to $34.31 following news that editors at the New England Journal of Medicine demanded changes to the published study that led the company to pull its painkiller Vioxx, and which Merck is using today as a pillar to its defense in liability suits.

Fortune Brands Inc., maker of Jim Beam bourbon and Titleist golf balls, expanded its product portfolio with its acquisition of privately held window maker SBR Inc. for $630 million in stock and debt. Fortune Brands slid 49 cents to $78.09.

Auto parts maker Visteon Corp. posted a fourth-quarter profit boosted by the sale of 23 manufacturing plants to former parent Ford Motor Co. and raised its 2006 profits estimates. Its shares nonetheless fell 11 cents to $4.73.

The Russell 2000 index of smaller companies lost 1.03, or 0.14 percent, to 717.13.

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