Signs Of Economic Strength Drive Dow Lower
Stocks drifted further away from record territory Thursday as some signs of economic strength stirred lingering inflation worries, sending interest rates higher again in the bond market
The Dow Jones industrial average fell 8.95 to 5,921.67, rebounding from an early 26-point loss, but extending a week-long slide from record levels and its first-ever move above 6,000 on Monday.
Broader measures also recovered from steeper losses in the morning, but the rebound was cut short by a worsening bond market.
Stocks have struggled this week amid growing caution before the impending release of company earnings reports and September’s inflation data.
“The market seems to move in jumps and then drift,” said Robert Streed, senior investment adviser at Northern Trust in Chicago. “We had a nice run a week ago and the market’s been drifting since then.”
Declining issues outnumbered advancers by nearly a 7-to-6 margin on the New York Stock Exchange, where volume totaled 394.95 million shares as of 4 p.m., down from 405.96 million on Wednesday.
Some of the stocks that moved substantially or traded heavily Thursday:
NYSE
Gulfstream Aerospace, up at 25-3/4 from initial offering at 24.
The new stock started trading after the corporate jet maker sold 37 million common shares for $888 million, or $24 each, in one of the larger initial public offerings of 1996.
General Electric, down 7/8 at 92.
GE’s profit rose 11 percent to $1.79 billion, or $1.08 per share, in the third quarter, lifted by the Summer Olympics broadcast by its NBC unit.
Monsanto, up 1-1/4 at 41-7/8.
The St. Louis-based company, looking to focus on its growing agricultural biotechnology operations, said it is studying alternatives for the future of its chemical businesses.
Olin, up 4-3/8 at 88-1/2.
The Norwalk, Conn.-based company plans to spin off its ammunition and aerospace divisions into a new company, Primex Technologies, and sell four chemical businesses, using the proceeds to buy back up to 10 million common shares.
NASDAQ
Sunglass Hut International, down 4-15/16 at 9-3/16.
The Coral Gables, Fla.-based sunglasses chain warned that earnings for the current quarter could fall below forecasts unless sales for the rest of the period exceed targets.
Frontier Airlines, down 1-27/64 at 5-13/64.
The Denver-based carrier said it will lose money in its second quarter ended Sept. 30. Frontier said that although September traffic more than doubled, the percentage of seats filled fell to 48.9 percent from 52.1 percent. Frontier Air also cited the reinstatement of a 10 percent federal ticket tax.