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Markets & Stocks
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Techs slip; Dow's adrift
Nasdaq ends the session lower, while the industrials close little changed. Falling oil helps some.
August 26, 2004: 5:59 PM EDT
By Alexandra Twin, CNN/Money Staff Writer

NEW YORK (CNN/Money) - Technology shares fell and the broader market barely budged Thursday as a fifth day of falling oil prices failed to awaken investors from a late summer haze.

The Dow Jones industrial average (down 8.33 to 10,173.41, Charts) and the Standard & Poor's 500 (up 0.13 to 1,105.09, Charts) index both closed near unchanged. The Nasdaq composite (down 7.80 to 1,852.92, Charts) slid about 0.4 percent.

Stocks had rallied Wednesday on falling oil prices, leaving the Dow at six-week highs. But those gains coincided with weak volume and proved unsustainable Thursday, even as oil prices fell for the fifth straight session.

Thursday marked another low-volume day, with just 1.17 billion shares trading hands on the Nasdaq, its lowest volume day of the year. Winners beat losers three to two.

On the New York Stock Exchange, winners edged losers by eight to seven as about 1.01 billion shares changed hands.

Volume is often weakest in late summer. That is bound to be exacerbated, analysts say, heading into next week's Republican National Convention (RNC) in New York.

The RNC runs from Monday, Aug. 30, through Thursday, September 2. Due to expected crowds and increased security measures, many New York-based Wall Street professionals are expected to be out of town during the convention.

"There are some rumors that although the market is open, a lot of people have decided to take long holidays, and so I think you'll see a drop in volume next week," said Michael Carty, principal at New Millennium Advisors.

Two economic reports of interest are due out Friday.

Before the bell, the Commerce Department releases the revised reading on second-quarter gross domestic product growth. GDP is expected to have grown at a 2.7 percent rate versus an initial read of 3 percent.

Shortly after the start of trading, the University of Michigan releases its revised read on consumer sentiment. The August index is expected to be unchanged from an initial read of 94.

Oil still roils

Stock investors have been particularly attuned to oil prices of late, with crude surging to record highs nearly every day for the first two weeks of August, ultimately peaking at $49.40 a barrel during last Friday's session.

Oil spent Thursday morning weaker after OPEC's president called for a quicker retreat in oil prices. Then prices bounced back before falling anew on news reports that an agreement has been reached to end the standoff in Najaf, Iraq.

Light crude for October delivery fell 37 cents to settle at $43.10 a barrel on the New York Mercantile Exchange.

"I think the market is still struggling with issues related to the global war on terror, as well as oil prices, but it's a myopic view," said Kevin Caron, a market strategist at Ryan, Beck & Co.

"Earnings in the second quarter have been good, the economy continues to recover, despite some of the recent data, and I think oil will continue to fall," he said. "As we move into the fall, the realization of this will relieve some of the nervousness in the market, and we should see an uptick heading into the end of the year."

What moved?

Among individual issues, Merck (MRK: down $0.97 to $45.05, Research, Estimates) was the Dow's biggest decliner, shedding more than 2 percent after a Food and Drug Administration study showed that the company's arthritis treatment could lead to heart failure. Kaiser Permanente said it is reconsidering whether it will continue using the drug, due to the study.

Chips were weaker.

Advanced Micro Devices (AMD: down $0.38 to $11.82, Research, Estimates) tumbled more than 3 percent after brokerage Banc of America Securities cut it to "neutral" from "buy" as part of a broader, bearish note on chips. The brokerage also cut estimates on Broadcom (BRCM: down $0.58 to $29.23, Research, Estimates), sending its shares down 2 percent.

Credence Systems (CMOS: down $0.47 to $7.00, Research, Estimates) warned that fiscal fourth-quarter earning and revenue will miss estimates, due to a slowdown in demand for its products. The warning sent its shares lower, overshadowing the company's stronger-than-expected third-quarter earnings report.

A number of retailers declined, falling on disappointing results.

Krispy Kreme Doughnuts (KKD: down $1.59 to $13.77, Research, Estimates) tumbled more than 10 percent after the retailer reported earnings of 9 cents a share, down from 21 cents a year ago and short of the 22 cents analysts were expecting.

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Retailer Starbucks (SBUX: down $2.97 to $43.07, Research, Estimates) sank around 6.5 percent after saying late Wednesday that sales at stores open a year or more rose 8 percent in August from a year ago. Analysts were expecting a gain of around 10 percent.

In a report released before the open, the Labor Department said 343,000 Americans filed new claims for state unemployment benefits last week, from an upwardly revised 333,000 the prior week. Economists expected 335,000 new claims, on average.

Treasury prices rose, pushing the 10-year note yield down to 4.21 percent from 4.26 percent late Wednesday. Bond prices and yields move in opposite directions.

In currency trading, the dollar fell versus the yen and euro.

COMEX gold fell 40 cents to settle at $409.60 an ounce.  Top of page




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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.