Late Pullback Cuts Off Stock Rally

An exuberant celebration of a key reading on inflation proved insincere Tuesday, with leading stock measures posting slim gains, if any, after a late pullback with bonds.

The Dow Jones industrial average, which rose about 100 points near the open and held a gain of about 90 through much of the session, fell 4.61 to close at 6,656.08. The late downturn led the blue-chip barometer to its fifth straight losing session. The Dow has slid 228 points over that span, more than halving the new year’s gain to 3.2 percent.

Some broad measures managed tiny gains after dipping into negative territory as bonds retreated in the afternoon.

Bond-market interest rates fell sharply in the morning after the Labor Department reported that employment costs, which constitute two-thirds of a product’s price, rose 0.8 percent in the fourth quarter, meeting analyst forecasts.

But bonds pulled back as nervous traders moved to secure some profits in advance of potential jolts from the week’s remaining reports, which include readings on durable goods orders, new home sales and fourth-quarter economic growth.

“There’s a high anxiety factor,” said A. Marshall Acuff Jr.

Advancing issues outnumbered decliners by more than a 4-to-3 margin on the New York Stock Exchange, where volume was heavy at 526.43 million shares as of 4 p.m.

Some of the stocks that moved substantially or traded heavily Tuesday:

NYSE

IBM, up 5 at 150-3/4.

Calling a 22-point beating over the previous four sessions overdone, Salomon Brothers reversed a week-old downgrade prompted by the computer maker’s fourth-quarter results. Also Tuesday, IBM announced plans to split its stock 2-for-1 on May 27.

General Motors, down 1-1/8 at 60-3/4.

The automaker’s fourth-quarter profit fell 58 percent, largely due to strikes that shut down many of its North American assembly plants, but the results were slightly above expectations.

Procter & Gamble, up 2-3/4 at 110-1/2.

The consumer product giant’s profits rose 13 percent in the October-December quarter, beating expectations despite a scant increase in sales.

NASDAQ

Kensey Nash, down 3 at 11-7/8.

The company is recalling its main product, a device that plugs surgical incisions, because a manufacturing problem may cause it to fail.

Ancor Communications, down 3-9/16 at 9-15/16.

An Ancor customer canceled a two-year $6 million contract for computer network switches.