Stocks close mixed as tech profit concerns drag down market

Associated Press

NEW YORK — Blue chip stocks closed higher but technology issues pulled the broader market lower today as nervous investors girded themselves for Intel’s third-quarter earnings report.

Trading volume was at its lightest level in three sessions amid growing anxiety about the chip maker’s earnings, which are expected to be released after the close of trading Tuesday. The angst, which sent software leader Microsoft to its lowest level in a year, erased many of the gains from Friday’s big rally.

The Dow Jones industrial average closed up 46.62 at 10,238.80, according to preliminary calculations.

Broader indicators were mixed. The Nasdaq composite index fell 26.52 to 3,290.25 after changing course several times during the session. The Standard &amp Poor’s 500 index was up 0.45 at 1,374.62.

"We’re still in a very tough period. Friday there was some bargain hunting, some relief as people looked for places to put their money, but I think it’s going to be very tough to make significant progress until later this year … maybe after Thanksgiving," said Charles Pradilla, chief investment strategist at SG Cowen Securities.

This is the second week in the third-quarter corporate earnings period, but the market has been down since September on anxiety about those results.

Stocks fell sharply last week after several companies reported flat or disappointing profits. The market closed higher Friday, but the gains were not enough to offset the week’s losses, which included a 379-point drop in the Dow on Thursday.

Blue chips got a boost Monday from utility stocks and the announcement that Texaco and Chevron will merge. Oil prices were also lower, with crude futures falling $1.10 to $32.70 on the New York Mercantile Exchange.

But the real story of the day appeared to be corporate earnings, in particular Intel, which has dropped significantly this month.

"If Intel can come out with positive numbers, it may give the market the sense that the end of this selloff may be in sight," said Gary Kaltbaum, a technical analyst at J.W. Genesis.

But investors didn’t appear confident that would happen. Intel’s stock fell $4.50 to $35.88 after a Salomon Smith Barney analyst said weak demand would hurt its sales.

Microsoft fell $3.81 to $49.94, a 52-week low. Web portal Yahoo! slipped $4.75 to $55.25.

The pessimism extended to non-technology stocks, as investors repeated their pattern of punishing those with disappointing earnings.

Bank of America fell $1.38 to $45.19 and Polaroid was off $2.31 at $9.25, after each company reported disappointing earnings.

Advancing and declining issues traded at a nearly even ratio on the New York Stock Exchange. Volume came to 998.72 million shares, behind the 1.22 billion shares traded Friday.

The Russell 2000 index rose 1.36 to 481.75.

Overseas, Japan’s Nikkei stock average rose 1.87 percent. Germany’s DAX index was off 0.51 percent, Britain’s FT-SE 100 up 1.23 percent, and France’s CAC-40 up 0.39 percent.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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