Dow Retreats Despite Favorable Fed Decision
The Federal Reserve gave investors what they were hoping for, leaving interest rates unchanged, but stocks ended mostly lower Wednesday as worries about computer-industry profits worsened.
The Dow Jones industrial average fell 17.36 to 5,703.02, more than halving an afternoon deficit of almost 38 points.
Broader indicators also improved after the Fed announced its decision not to slow the economy with a rate hike, but still ended mostly lower.
“It shouldn’t be surprising that there was not that big a rally,” said William Dodge, portfolio manager at Marvin & Palmer Associates of Wilmington, Del. “The market’s early weakness shouldn’t have been attributed to the Fed. The preponderance of the negative news is coming from technology.”
Declining issues outnumbered advancers by a 10-to-9 margin on the New York Stock Exchange, where volume slowed considerably going into the July 4 holiday, totaling 334.57 million shares as of 4 p.m.
Some of the stocks that moved substantially or traded heavily Wednesday:
NYSE
CompUSA, up 1/2 at 38-1/4.
The computer retailer’s sales at stores opened at least a year rose 9.8 percent in its fiscal fourth quarter. Total sales for the three months ended June 29 rose 38 percent to $999 million from $724 million.
AnnTaylor Stores, down 2-1/8 at 18-1/8.
A retail analyst at Deutsche Morgan Grenfell estimated the retailer will report a sales decline of 5 percent for stores open at least a year, the Dow Jones News Service reported. There had been some predictions that the retailer’s same-store sales would turn positive in June after an 11.2 percent decrease in May.
Boyd Gaming, down 2-1/2 at 12-3/4.
The gaming hall operator expects its income for the just-ended quarter to fall shy of analyst expectations due to disappointing results at Sam’s Town Tunica and Sam’s Town Kansas City.
NASDAQ
Astea International, down 14-1/4 at 8-3/4.
The maker of software for customer support, field service and sales expects disappointing results for the second quarter because several orders did not close on schedule.
FileNet, down 9-1/4 at 23-3/4.
Volpe Welty downgraded FileNet a day after it projected second-quarter revenue of about $65 million and net income of 15 cents a share. Volpe had estimated FileNet would report revenue of $71.3 million and earnings of 38 cents a share.
Spacetec IMC, down 2-3/4 at 11-7/8.
The maker of 3-D hardware and software company said revenue for its fiscal first quarter will be flat compared with the same period last year, below management’s expectations.