Stocks sag, but HP shares soar
Stocks sagged Wednesday in a bout of profit-taking, but blue chips fared better than they might have otherwise as shares of Dow component Hewlett-Packard Co. surged following the ouster of CEO Carly Fiorina.
The robust performance of HP shares gave the Dow Jones industrial average a bit of a lift, but it was not enough to keep the index in positive territory. Oil prices were volatile as government inventory data showed lower-than-expected fuel supplies, and Treasuries rallied.
“Oil is definitely factoring in … but let’s also take into account that the market has seen a nice little snap back during February after what can only be described as a dismal January,” said Bryan Piskorowski, market analyst at Wachovia Securities. “To a certain extent, the market is using the oil figures as a reason to do some profit taking, and the dollar is lower, so that’s rolled together to pare some recent gains.”
The Dow fell 60.52, or 0.56 percent, to 10,664.11.
The broader gauges were also lower. The Standard & Poor’s 500 index declined 10.31, or 0.86 percent, to 1,191.99. The Nasdaq composite index skidded 34.13, or 1.64 percent, at 2,052.55.
Oil prices rebounded briefly after the government’s weekly inventory figures showed a surprising 1 million barrel drop in crude inventories; analysts had expected a build of 730,000 barrels. Stores of distillate fuels, which include heating oil, also declined more steeply than expected. By afternoon, the rally fizzled, however.
Crude futures settled up 6 cents at $45.46 a barrel on the New York Mercantile Exchange, after trading as low as $44.60 a barrel and as high as $46.40. Meanwhile, the U.S. dollar fell against other major currencies.
A run-up in Treasuries may also have worked against stocks, analysts said, noting that the yield on the 10-year note had slipped below 4 percent for the first time in more than three months, to 3.98 percent. Some of the buying was linked to the government’s auction of $15 billion in five-year notes, but bonds had already been moving higher, perhaps due to Atlanta Federal Reserve President Jack Guynn’s suggestion in an interview with The Wall Street Journal that the group might need to change its policy statement as it adjusts the pace of interest rate hikes.
Decliners outnumbered advancing issues by more than 2 to 1 on the New York Stock Exchange. Preliminary volume came to 1.92 billion shares, compared to 1.83 billion Tuesday.
The Russell 2000 index, which tracks smaller company stocks, was down 13.01, or 2.04 percent, at 625.71.
Overseas, Japan’s Nikkei stock average slipped 0.15 percent. In Europe, France’s CAC-40 slid 0.28 percent, Britain’s FTSE 100 fell 0.10 percent and Germany’s DAX index declined 0.42 percent.