Stocks mixed after Boeing shakeup
A cautious stock market finished the session mixed Monday as a troubling top-level management shakeup at Boeing Co. pressured blue chips, while technology shares saw strong buying. The Dow Jones industrial average came within 16 points of cracking 11,000 but settled with a minimal loss.
Profit-taking pushed the Dow lower as Boeing, a Dow component, said Chief Executive Officer Harry Stonecipher was asked to resign by the company’s board for a relationship with a female executive. It is the second major CEO scandal for the aircraft manufacturer in less than 1 1/2 years.
However, investors were cheered by three separate merger announcements in the financial, defense and communications sectors — a sign of corporate America’s confidence in economic growth. A jump in tech stocks, which had been lagging in the market’s recent rally, reflected newfound confidence on the part of investors.
“If you’re going to go higher, you have to have techs involved, and we’re seeing that,” said Todd Leone, managing director of equity trading at SG Cowen Securities. “Overall, the market seems pretty resilient. It looks like it wants to go to 11,000.”
The Dow fell 3.69, or 0.03 percent, to 10,936.86, failing to top the 3 1/2 -year high reached Friday, when it rose 107 points. The Dow reached 10,984.16 in intraday trading before moving lower in the final hour of trading.
Broader stock indicators gained ground. The Standard & Poor’s 500 index was up 3.19, or 0.26 percent, at 1,225.31, also adding to its multiyear high from Friday. The Nasdaq composite index gained 19.60, or 0.95 percent, to 2,090.21 on the momentum of technology shares.
A late rise in crude oil futures helped send the Dow off its session highs. A barrel of light crude was quoted at $53.89, up 11 cents, on the New York Mercantile Exchange. Bonds rose, with the yield on the 10-year Treasury note falling to 4.3 percent, while the dollar rose against most major currencies and gold was up as well.
Analysts noted that investors were attracted to technology shares prior to Texas Instruments Inc.’s mid-quarter earnings update, due after the session, and National Semiconductor Corp.’s quarterly earnings on Thursday. While tech stocks have lagged behind the rest of the market, Friday’s strong employment report from the Labor Department and subsequent runup in stocks encouraged many investors to re-enter the market.
“There’s a lot of money coming back into the market right now,” said Brian Williamson, an equity trader at The Boston Company Asset Management. “What we saw on Friday was encouraging for a lot of people, and it’s great to see us building on that.”
Advancing issues barely outnumbered decliners on the New York Stock Exchange, where preliminary consolidated volume came to 1.93 billion shares, compared with 2.13 billion on Friday.
The Russell 2000 index of smaller companies was down 1.09, or 0.17 percent, at 643.86.
Overseas, Japan’s Nikkei stock average rose 0.44 percent. In Europe, Britain’s FTSE 100 closed down 0.18 percent, France’s CAC-40 climbed 0.4 percent for the session, and Germany’s DAX index gained 0.1 percent.