- The Washington Times - Thursday, December 3, 2009

NEW YORK | The stock market struggled but held its ground Wednesday as an upbeat assessment of the economy from the Federal Reserve offset drops in bank and energy stocks.

Most stocks finished higher after the Fed said regional economic activity has generally improved since its last snapshot in October. The central bank also said consumer spending has strengthened even as employment and commercial real estate remain weak.

The Dow Jones Industrial Average slipped nearly 19 points a day after jumping 126. Reports of analysts’ warnings about bank stocks hurt financial shares, while a steep drop in oil weighed on energy companies. Airlines jumped on hopes business is stabilizing.

A mixed reading on the labor market also kept trading subdued. The ADP National Employment Report said private companies cut 169,000 jobs in November, fewer than the number lost in October but worse than the 160,000 cuts expected by economists polled by Thomson Reuters. It was the eighth monthly drop.

Trading has been volatile in recent days as investors try to determine whether the massive gains in the stock market since early March accurately reflect the economy’s strength. Investors have been worried that the nascent recovery could be threatened by economic problems overseas or missteps by the government and the resulting gyrations in the dollar. Concerns over a potential debt crisis in Dubai caused a temporary halt in buying last week.

The Dow fell 18.90, or 0.2 percent, to 10,452.68, pulling off of a 14-month high reached Tuesday. The Standard & Poor’s 500 index edged up 0.38, or less than 0.1 percent, to 1,109.24, and the Nasdaq Composite index rose 9.22, or 0.4 percent, to 2,185.03.

The ICE Futures U.S. dollar index, which measures the dollar against other major currencies, edged up 0.3 percent. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.32 percent from 3.29 percent late Tuesday.

Gold prices surged to a new high of $1,218.40 an ounce, while oil prices fell $1.77 to settle at $76.60 a barrel on the New York Mercantile Exchange.

Among financial stocks, Bank of America fell 24 cents, or 1.5 percent, to $15.65, while Wells Fargo & Co. slid 54 cents, or 1.9 percent, to $27.45 on reports that some analysts voiced concerns about industry profits next year.

Meanwhile, Chesapeake Energy Corp. fell 70 cents, or 2.9 percent, to $23.40 as oil fell. Occidental Petroleum Corp. slid 97 cents, or 1.2 percent, to $81.21.

Airlines rose after Continental Airlines Inc.’s November results weren’t as bad as feared and as a Delta Air Lines Inc. official said the carrier would be cautious as it expands. Delta acquired Northwest Airlines last year. Continental rose 71 cents, or 4.8 percent, to $15.67, while Delta rose 67 cents, or 7.7 percent, to $9.29.

The Russell 2000 index of smaller companies rose 6.89, or 1.2 percent, to 596.09.

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