Wall St flat due to fears of debt crisis
US stocks ended flat yesterday, dropping off earlier highs as a weak US bond auction and global debt concerns continued to weigh on investor sentiment.
Indexes advanced for most of the session, with the Dow and S&P hitting fresh 18-month highs, but their gains mostly disappeared after the auction of seven-year notes and comments from European Central Bank President Jean-Claude Trichet on issues surrounding Greece’s sovereign debt.
Trichet told France’s Public Senat television that if the IMF or some other body exercises the responsibility in lieu of the Eurogroup or instead of governments, “it is evidently very, very bad.”
“We are losing our stock gains because of the threat of rising U.S. yields and the weakening of the euro,” said Tom Sowanick, chief investment officer of the Omnivest Group in Princeton, New Jersey.
The session’s early gains came after both Qualcomm and Best Buy gave bullish profit outlooks, an encouraging sign ahead of the upcoming earnings season.
The Dow Jones industrial average was up 5.06 points, or 0.05 per cent, to end at 10,841.21. But the Standard & Poor’s 500 Index was down 1.99 points, or 0.17 per cent, at 1,165.73. And the Nasdaq Composite Index was down 1.35 points, or 0.06 per cent, at 2,397.41.
Oracle shares slipped 0.7 per cent to $25.86 in extended trading after reporting adjusted third-quarter earnings that beat expectations by a penny.
The stock, which is near a nine-year high, had jumped 1.1 per cent in regular trading to end at $26.04 on Nasdaq.
Wall Street watches Oracle’s results closely to determine whether corporate technology spending is on the mend.
Kim Caughey, senior analyst at Fort Pitt Capital Group, said Oracle “did well this quarter, but what I’m most interested in is their plan for Sun, because that it a lower-margin business than they are used to being in, and it did drag the margins down somewhat.”
Data showed the number of US workers filing new applications for unemployment insurance fell.