Markets & Stocks
Mixed message
Stocks retreat from gains as ISM index shows no growth in manufacturing.
October 1, 2002: 10:27 AM EDT
By Parija Bhatnagar, CNN/Money Staff Writer

NEW YORK (CNN/Money) - U.S. stocks turned mixed early Tuesday after a key read on manufacturing activity came in below forecasts.

Around 10:25 a.m. ET, the Dow Jones industrial average (up 11.51 to 7603.44, Charts) erased almost all of its early gains, while the Nasdaq composite (down 10.20 to 1161.86, Charts) and Standard & Poor's 500 index (down 1.66 to 813.62, Charts) were negative.

The Institute of Supply Management's index of September manufacturing activity fell to 49.5 from 50.5 in August. Economists had been expecting a rise, but a weak regional report from Chicago on Monday may have braced investors for the disappointment. A number above the key level of 50 denotes continued expansion in manufacturing activity.

In company news, a bullish call on a tech bellwether could give a lift to a beaten-down technology sector.

Banc of America upgraded Dell Computer (DELL: up $0.32 to $23.83, Research, Estimates) shares to "buy," citing stronger conviction of sustainable growth, including the PC maker's recent entry into new market segments. The brokerage's note came a day ahead of Dell's two-day analysts meeting in Texas.

All of the major stock indicators wrapped up an abysmal September and third quarter Monday with solid losses. The Dow lost about 18 percent for the quarter and 12 percent for the month. The Nasdaq lost 11 percent for September and 20 percent for the quarter. The S&P suffered its worst third-quarter results since 1987, dropping about 18 percent for the quarter and 11 percent for the month.

European markets were higher at midday, while Asian-Pacific stocks were mixed Tuesday, with Tokyo's Nikkei index down 2.4 percent but South Korea and Australia ending higher.

Treasury prices slipped in early trading, sending the 10-year note yield up to 3.69 percent from 3.59 percent -- the lowest point since 1958 -- late Monday. The dollar gained against the yen, but was little changed versus the euro.

Brent oil futures gained 13 cents to $28.88 a barrel in London, where gold was little changed.  Top of page

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