Late Rally Preserves Russell’s Winning Streak
A late rally salvaged a record-setting streak by some stock indexes, but blue-chip shares pulled back Tuesday after some discouraging earnings news and a stumble in the recent bond rally.
The Dow Jones industrial average took another short-lived trip above 8,000 in early trading, but quickly turned lower and fell 26.77 to close at 7,970.06.
Broader measures were mixed, with the Russell 2000 index of smaller companies and the Nasdaq composite index shooting into positive territory during the final half hour.
The late rally, which also trimmed a 67-point loss by the Dow, gave the Russell 2000 its eighth straight closing high and the Nasdaq its fourth straight. The record was also the 17th in 19 sessions for the Russell 2000.
It was the third time in four sessions that the Dow failed to hold above the 8,000-mark.
Although the past week’s gains made the Dow vulnerable to some profit-taking, said Smith Barney strategist A. Marshall Acuff Jr., Tuesday’s selling “also suggests that the (blue-chip sector) doesn’t seem ready yet to move to a new high.”
Notably, even with a 250-point gain over the prior eight sessions, the Dow sat another 250 points shy of its early August peak coming into Tuesday’s session.
Micron Technology, down 3-1/2 at 37.
The chipmaker’s profits for its fourth quarter ended Aug. 28 quadrupled compared with year-ago levels, but failed to meet analyst forecasts. Micron, based in Boise, Idaho, released its earnings report after Monday’s close.
Delta Airlines, down 4-5/8 at 102-1/16.
The carrier warned late Monday that it expects to report disappointing results for its first quarter ending Sept. 30. In a separate announcement today, Delta followed United Airlines in cutting travel agency commissions to 8 percent from 10 percent.
Aetna, down 9-1/16 at 93-11/16.
The insurer’s shares slid on speculation that Aetna may guide analysts to lower their forecasts for its third-quarter earnings, the Dow Jones News Service reported. Aetna is based in Hartford, Conn.
Informix, down 23/32 at 6-5/8.
The stock slid for a second session after the software maker warned that the accounting irregularities discovered in its financial statements for the past two fiscal years are more serious than originally thought. Informix, based in Menlo Park, Calif., said it is continuing an audit.
Questron Technology, up 1-1/4 at 7-7/8.
The distributor of electronic components issued an upbeat profit forecast, citing its recent acquisitions. Questron is based in Boca Raton, Fla.
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