- The Washington Times - Tuesday, February 20, 2007

NEW YORK (AP) — Wall Street managed a moderate advance in an uneven session yesterday after a drop in oil prices and encouraging comments from a Federal Reserve official allowed investors to shrug off disappointment over Home Depot Inc.’s declining sales. The Dow Jones Industrial Average set another closing high.

Home Depot said sales at stores open more than a year dropped in the fourth quarter, suggesting that consumers’ appetite for home improvement goods is still dwindling because of the sluggish housing market.

The company’s results sent the market down in early trading, but comments from outgoing Fed Governor Susan Bies, who said slumping demand for housing may have bottomed out, alleviated some concern about the downturn dragging down the rest of the economy. Her remarks echoed those of Fed Chairman Ben S. Bernanke, who last week predicted the economy would keep growing at a modest pace.

“The overall trend of the market is basically positive,” said Brian Gendreau, investment strategist for ING Investment Management, pointing to Mr. Bernanke’s recent forecast of moderating growth and cooling inflation. “That’s a great environment for equities. Unless you have some specifically nasty news, there’s no reason why the trend shouldn’t be upward.”

Falling oil prices, which tumbled $1.32 to $58.07 a barrel on the New York Mercantile Exchange on forecasts of warmer weather, also lent some support to stocks.

The Dow rose 19.07, or 0.15 percent, to 12,786.64, after falling more than 60 points earlier. Yesterday’s climb brought the index to its 31st record close since early October, and its biggest five-day rally since mid-November. The Dow also reached a new trading high of 12,795.93, just short of 12,800.

The Standard & Poor’s 500 Index rose 4.14, or 0.28 percent, to 1,459.68, and the Nasdaq Composite Index climbed 16.73, or 0.67 percent, to 2,513.04. The Russell 2000 Index of smaller companies rose 7.96, or 0.97 percent, to 826.11.

ConocoPhillips fell 57 cents to $65.58; Chevron Corp. fell 69 cents to $70.12; and Exxon Mobil fell 42 cents to $74.87.

Home Depot’s weaker-than-anticipated sales also kept some pressure on stocks.

Home Depot fell 10 cents to $41.34 after reporting same-store sales that disappointed analysts. But Wal-Mart rose $1.78, or 3.7 percent, to $50.26 after issuing its financial results, which showed better-than-expected fourth-quarter profit growth and an upbeat forecast for 2007.

Hewlett-Packard Co. said after the market closed that holiday sales drove its profit up in the latest quarter by 26 percent. The results beat analysts’ expectations, but the computer and printer maker’s stock fell 43 cents to $42.70 in after-hours trading after closing up 36 cents at $43.13 in regular trading.

British drug company Shire is buying U.S. drug maker New River Pharmaceuticals for about $2.6 billion; Vulcan Materials is acquiring construction aggregate maker Florida Rock Industries for $4.6 billion; and EMI Group said it was approached by Warner Music about a takeover.

Florida Rock soared $19.58, or 42 percent, to $66.54.

Warner Music climbed 90 cents, or 4.9 percent, to $19.15.

New River, of Radford, Va., surged $4.84, or 8.3 percent, to $63.19.

Not all takeover talk was positive for stocks, though. General Motors Corp. slipped 39 cents to $35.95 as rumors continued to circulate that the struggling automaker is interested in buying Chrysler Group.

Advancing issues outnumbered decliners by about 5 to 3 on the New York Stock Exchange.

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times is switching its third-party commenting system from Disqus to Spot.IM. You will need to either create an account with Spot.im or if you wish to use your Disqus account look under the Conversation for the link "Have a Disqus Account?". Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide