Tech stocks received a boost from earnings news Thursday, but a surge in oil prices weighed on the Dow Jones industrial average.
The Dow fell 24.26 points, to 10,289.10. The Standard & Poor’s 500 index added 2.11, to 1118.38. The tech-heavy Nasdaq composite index gained 19.01, to 1869.65.
Crude oil surged almost $2 a barrel to a two-week high after the Energy Department reported that U.S. inventories declined more than expected last week.
Stockpiles fell for the sixth week in a row, and are at their lowest level since March.
Crude oil for October delivery rose $1.84, or 4.3 percent, to settle at $44.61 a barrel on the New York Mercantile Exchange, the highest closing price since Aug. 24.
Investors grew more cautious during the session as oil prices climbed, and they also were disappointed by the Commerce Department’s report on wholesale inventories, which rose 1.3 percent in July, more than economists had expected. Wholesale sales rose by only 0.5 percent, which suggests that business and consumer spending has trailed off and more products are sitting in warehouses.
“We’re starting to see some real evidence of softness in consumer spending,” said Russ Koesterich, U.S. equity strategist for State Street Corp. in Boston. “I don’t think the economy is falling off a cliff. It’s chugging along at a moderate pace, but will it be enough to keep corporate profits where they need to be? That’s the question.”
Although Federal Reserve Chairman Alan Greenspan was optimistic about the economy’s strength in congressional testimony Wednesday, Wall Street took a more cautious view, waiting to see how the summer’s economic slowdown will affect third- and fourth-quarter earnings.
“The next catalyst for the market won’t be the Fed meeting or interest rates,” said Hans Olsen, managing director and chief investment officer at Bingham Legg Advisers. “It’ll be company earnings, and whether there’s been enough top-line movement to have an impact on the bottom line.”
Tech stocks, battered this summer after a series of disappointing earnings reports, were buoyed by some rare good news Thursday.
Nokia jumped $1.06, or more than 8 percent, to $13.77, after the Finnish maker of cell phones raised its sales and profit outlooks for the current quarter. The company cited stronger demand for multifunction mobile devices.
Texas Instruments said it expected third-quarter earnings to come in above the middle of its previous estimate range. The chipmaker gained $1.94, to $20.77. The 10.3 percent jump was its biggest increase since April 2003.
During the session, National Semiconductor reported a 29 percent jump in sales and beat earnings estimates by 5 cents a share. National Semiconductor surged $1.48, or 12 percent, to $13.48, for the biggest advance in the S&P 500.
An index of semiconductor-related shares in the S&P 500 climbed 4.5 percent, its largest increase in almost 11 months.
An index of energy shares in the S&P 500 gained 1.3 percent, with all 27 members rising. Exxon Mobil added 41 cents, to $47.48. ChevronTexaco advanced $1.28, to $101.08.
Chicago-based Boeing was the biggest drag on the Dow, losing 79 cents, to $53.26. Johnson & Johnson shed 76 cents, to $56.51, for the second-biggest loss in the Dow.
Shares of Northbrook-based Allstate and other insurers fell. Hurricane Ivan, packing winds of 160 m.p.h., moved across the Caribbean toward Jamaica on a path that may make it the third hurricane to hit Florida in a month.
Allstate dropped $1.04, to $46.50. Hartford Financial Services Group slipped 56 cents, to $61.84.
Higher energy costs may be crimping consumer and business spending, hurting earnings for some companies.
Home Depot, the nation’s largest home-improvement chain, shed 26 cents, to $37.01. Wal-Mart Stores, the world’s largest retailer, lost 51 cents, to $52.57. Federated Department Stores, the owner of Macy’s and Bloomingdale’s, slid 85 cents, to $44.15.
An index of retail stocks shed 1 percent, the second-largest drop among the 24 industry groups in the S&P 500.
