Dow Retreats As Wary Investors Dump Stocks

Blue-chip stocks ended slightly lower Wednesday, masking a fairly broad pullback spurred by growing anxiety about inflation, interest rates and earnings momentum in the sagging technology sector.

The Dow Jones industrial average fell 18.88 to 6,877.68, erasing most of a 70-point deficit over the last hour of trading.

Investors left broader measures with much steeper losses, however, once again punishing the technology-laden Nasdaq market and migrating away from riskier small- and medium-sized companies.

“It looks like a modest pullback. But in reality, stocks got hurt a lot more than the indexes indicate. The Dow created an effective smokescreen,” said Bob Dickey, managing director of technical analysis at Dain Bosworth in Minneapolis.

Declining issues outnumbered advancers by an 8-to-5 margin on the New York Stock Exchange, where volume totaled 535.56 million shares as of 4 p.m., up sharply from 467.27 million in the previous session.

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

NYSE

Sprint, up 2 at 45-1/8.

The long distance carrier and partner France Telecom denied a report in The Wall Street Journal that Cable & Wireless of Britain may make a takeover bid for Sprint.

R.R. Donnelley & Sons, up 2-3/8 at 32-3/4.

The nation’s largest commercial printer named Emerson Electric executive William L. Davis as its new chairman and chief executive. Davis succeeds John M. Richman, who filled those posts on an interim basis after John R. Walter left in October to become president of AT&T.

Lexmark International Group, down 3-7/8 at 23-7/8.

The maker of laser inkjet printers and typewriters cautioned that its first-quarter revenues will be below expectations.

NASDAQ

Adobe Systems, up 3-3/4 at 38-5/8.

The software maker’s first-quarter profits jumped 38 percent, soundly beating Wall Street estimates on robust sales of its desktop publishing programs.

Jabil Circuit, up 6 at 45-5/8.

Needham & Co. and Cowen & Co. upgraded the circuit board maker to “strong buy” from “buy,” the Dow Jones News Service reported.

AMEX

Pan American World Airways, down 1-1/2 at 9-7/8.

The airline is discussing a buyout of discount carrier Carnival Air Lines, source close to negotiations said. The pair had a $100 million merger agreement last July before Pan Am resumed flying, but the deal fell apart.