- The Washington Times - Friday, March 20, 2009

NEW YORK (AP) - Stocks headed for a mixed open Friday, with investors concerned that the Federal Reserve’s plan to inject more money into the economy might not be a cure and could lead to some damaging consequences.

The worry is that the Fed’s decision to buy Treasury and other securities will weigh on the dollar and stoke inflation. In just two days, the dollar has fallen 5 percent versus the euro and 3 percent versus the yen. Oil prices, meanwhile, soared 7 percent Thursday above $51 a barrel to its highest level this year.

Wall Street had initially jumped on the central bank’s announcement Wednesday, but gave up a portion of those gains Thursday. After surging 14 percent over seven trading days, the Dow Jones industrial average fell nearly 86 points, or 1.2 percent.

But considering how much the market has rallied, it appears to be holding up well. Since a batch of troubled banks told investors they were profitable in January and February nearly two weeks ago, the stock market bounced off its 12-year lows. Even after Thursday’s retreat, the Dow was still up 13 percent from its lows, and the S&P; 500 index was up nearly 16 percent.

The question on Wall Street, though, is whether there will be enough good news in the coming days to keep stocks from wiping out the rally altogether.

With no economic data anticipated Friday and Fed Chairman Ben Bernanke scheduled to give a speech in Phoenix at noon, Wall Street was poised for mixed open.

Ahead of the market’s open, Dow Jones industrial average futures rose 3, or 0.04 percent, at 7,414. Standard & Poor’s 500 index futures fell 2, or 0.3 percent, to 773.10, while Nasdaq 100 index futures rose 0.75, or 0.06 percent, to 1,204.25.

Government bond prices rose after retreating Thursday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.57 percent from 2.60 percent late Thursday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.20 percent from 0.18 percent.

The dollar recovered modestly against other major currencies. Gold prices slipped.

Oil prices fell 52 cents to $51.09 a barrel in premarket electronic trading on the New York Mercantile Exchange.

In corporate news, mobile phone maker Sony Ericsson on Friday warned it expects to post a first-quarter loss before taxes as consumer demand continues to decline.

Printer and copier maker Xerox Corp. slashed its first-quarter profit forecast by nearly 80 percent on restructuring costs and a slowdown in technology spending. Xerox now expects earnings per share in a range of 3 cents to 5 cents, down from its previous forecast of 16 cents to 20 cents.

And Italian automaker Fiat said it will not assume Chrysler’s current or future debt as it takes a 35 percent stake in the company.

Overseas, Japan’s stock market was closed for a holiday. In afternoon trading, Britain’s FTSE 100 fell 0.21 percent, Germany’s DAX index rose 0.17 percent, and France’s CAC-40 fell 0.38 percent.

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On the Net:

New York Stock Exchange: https://www.nyse.com

Nasdaq Stock Market: https://www.nasdaq.com

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