NEW YORK (CNNfn) - U.S. stocks turned lower at midday Thursday, seeking direction amid overnight news about Indonesian President Suharto's resignation, rumors of border tensions between India and Pakistan and market-friendly remarks from Federal Reserve Chairman Alan Greenspan.
In prepared remarks for the House Agriculture Committee, Greenspan said the effects of the economic turmoil in Asia are "only just now being felt" in the U.S. economy. He reiterated his concerns about a "small but not negligible probability" that the Pacific Rim's problems could have a larger-than-expected effect on the economies in other parts of the world.
Wall Street seemed to get support from the news of Suharto's resignation, which helped stabilize Asian markets and gave a boost to European stocks. Activity, however, was limited as many traders prepared for a long holiday weekend. U.S. financial markets will close early Friday and remain closed Monday for the Memorial Day holiday.
Shortly after 1:30 p.m., the Dow Jones industrial average was 25.16 points lower at 9,146.32. On the New York Stock Exchange, advancing stocks trailed declines 1,258 to 1,525 as 348 million shares changed hands.
The Nasdaq Composite traded 4.62 lower at 1,827.13 and the S&P 500 index inched 2.18 down to 1,116.88.
Bonds rose and then retreated following Greenspan's market-friendly remarks. The benchmark 30-year Treasury bond was unchanged in price, to yield 5.89 percent percent.
The dollar pared some of its losses against the Japanese yen, scored as news that Suharto stepped down breathed some life back into currencies of the Pacific Rim. But the continuing weakness of the Japanese economy helped limit the greenback's declines, as did skepticism over Suharto's successor -- vice president Jusuf Habibie. The dollar also fell against the German mark.
Wall St. seeks direction
Stocks traded within a tight range as investors weighed Suharto's resignation against the possibility that the Asian crisis would slow down U.S. growth just enough to make an interest rate hike unnecessary.
Some Dow components that rose sharply Wednesday gave back much of their gains, limiting advances for the blue-chip index. American Express (AXP), which gained 3-5/8 Wednesday, traded down 2-3/16 to 103-15/16. But Disney (DIS), which rose 3-11/16 Wednesday, added another 1-1/4 to trade at 115-7/8.
Technology stocks, which unlike blue chips took a heavy dose of selling Wednesday, traded mixed. Dell (DELL) fell 3 to 88-3/4 and Intel (INTC) lost 2 to 75. However, Microsoft (MSFT) rose 1/4 to 86 even as the company faces the first hearing in a broad antitrust suit against it Friday.
Among the day's few newsmakers, Internet search engine Excite (XCIT) rose 1-5/8 to 61-13/16 after the company received and rejected an uninvited takeover bid from Internet power wannabe Zapata (ZAP). Zapata slipped 5/8 to 10-3/4.
And drug maker Pfizer (PFE) tumbled 3-13/16 to 109 after its new impotence drug Viagra was found to cause severe, sometimes lethal, low blood pressure in patients taking nitroglycerin.
Finally, Midway Games (MWY), a video game manufacturer, fell 2-7/16, or more than 15 percent, to 13-7/16 after the company warned that its fiscal fourth-quarter earnings would fail to meet expectations. 
-- by staff writer Malina Poshtova Zang
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