US stocks dip after Bernanke strategy
US stocks dipped yesterday as worries over Federal Reserve Chairman Ben Bernanke’s strategy after the economy recovers offset optimism about a possible rescue for debt-burdened Greece.
Trading volume was light, with many participants leaving early because of an East Coast snowstorm.
The French daily Le Monde wrote that France and Germany were set to present a plan at a European Union summit on Thursday aimed at preventing Greece from going bankrupt.
But stocks initially dropped after Bernanke gave his most detailed description to date of how the Fed would dismantle emergency supports put in place to bolster an ailing economy. Shares recovered as some felt the initial reaction was overdone.
“A little tone that interest rates might go up some time spooked investors a little bit in the morning,”said Alan Lancz, president of Alan B. Lancz & Associates, an investment advisory firm in Ohio.
“I think we could have been down more, but the news came out (on Greece), and, short-term, I think it alleviates one of the clouds that have been hanging over the market.”
Energy and industrial companies, including Chevron, were among the biggest drags on the Dow, reversing Tuesday’s trend. Chevron slipped 0.8 per cent to $70.75.
Financials were the only S&P 500 sector to close higher. The S&P financial index gained 0.8 per cent.
The Dow Jones industrial average was down 20.26 points, or 0.20 percent, at 10,038.38. The Standard & Poor’s 500 Index was down 2.39 points, or 0.22 per cent, at 1,068.13. The Nasdaq Composite Index was down 3.00 points, or 0.14 per cent, at
2,147.87.
The market fluctuated between positive and negative during the day, and traders said the low volume was a major factor.
On the corporate side, Sprint Nextel sank 8 per cent to $3.36 after it reported quarterly revenue that missed Wall Street’s consensus forecast. Wyndham Worldwide gained 4.7 per cent to $22.22 after it tripled its dividend.
Dow component Walt Disney rose 0.6 per cent to $30.03 a day after it reported strong first-quarter results