NEW YORK (CNN/Money) -
Stocks ended mixed Tuesday, abandoning gains near the close as investors reacted to speculation about the outcome of the presidential election.
Nasdaq and S&P 500 futures pointed to a mixed open Wednesday, when fair value is taken into account. However, that could change by the morning, depending on election results.
The Nasdaq composite (up 4.92 to 1,984.79, Charts) index added 0.25 percent Tuesday.
The broader Standard & Poor's 500 (up $0.05 to $1,130.56, Research) index closed little changed. The Dow Jones industrial average (down 18.66 to 10,035.73, Charts) lost 0.2 percent. All three indexes had been much higher through mid afternoon.
Anticipation about the presidential election has been building for months, in what could be one of the closest contests in the nation's history. Most polls have shown President Bush and Democratic challenger Sen. John Kerry in a statistical dead heat.
Stocks had been higher throughout the session. But the advance evaporated in the last hour of trade on profit taking sparked by speculation that early exit polls were favorable for John Kerry, traders said.
Traditionally, Wall Street prefers a Republican administration, as it is seen as more big-business friendly. So talk that was more favorable to Kerry may have given traders an incentive to sell.
"There's going to be a lot of volatility until we get a firm decision," said Art Hogan, chief market analyst at Jefferies & Co.
"Any decision is going to give stocks a boost short term, because the last thing the market wants to see is another 2000," he added.
Although the country may be split on its choice for president, concerns about a prolonged legal dispute over the outcome have loomed over the markets recently.
"Although the expectations we've been hearing indicate a prolonged decision, the markets are telling us that the election will be resolved quickly," said Hugh Johnson, chief investment officer with First Albany.
Oil prices slumped again Tuesday, adding to a slide that's knocked about 10 percent off the price of crude since last Wednesday when the government reported a stronger-than-expected increase in crude supplies.
U.S. light crude for December delivery sank 51 cents to settle at $49.62 a barrel on the New York Mercantile Exchange.
Stocks have rallied recently with the Dow Jones industrial average, adding about 4 percent since early last week as crude prices cooled and concerns about a prolonged election have eased.
Earnings reports are due before the bell from Duke Energy, Cigna and Time Warner, among others. However, the earnings are likely to be overshadowed by the election mania.
Reports are due after the bell Wednesday on factory orders and the services sector of the economy.
Factory orders are expected to have risen 0.4 percent in September after falling 0.1 percent in August. The Institute for Supply Management's services index is expected to have risen to 58 in October, from 56.7 in September.
What moved?
Techs remained strong, even after the markets abandoned gains.
Dow component Hewlett-Packard (up $0.24 to $19.00, Research) rose around 1.3 percent, joining a number of strong technology stocks.
Yahoo! (up $0.82 to $37.74, Research) and other Internet stocks gained. The Goldman Sachs Internet (Charts) index rose 0.9 percent.
Nextel (up $0.81 to $26.90, Research) gained on news that it had settled its legal dispute with Verizon Wireless, a unit of Verizon Communications (up $0.02 to $40.00, Research).
Among other movers, Merck (down $1.48 to $26.80, Research) slipped more than 5 percent and was the New York Stock Exchange's most-actively traded issue after ratings agency S&P put it on credit watch. On Monday, reports surfaced showing that the company knew about and attempted to hide the risks of Vioxx, prior to its withdrawal from the market in September.
Among the Dow advancers, financials were particularly strong. American Express (up $1.09 to $54.00, Research) gained more than 2 percent and AIG (up $0.70 to $61.47, Research) gained 1.5 percent.
In other news, chips were weaker after National Semiconductor (down $0.29 to $16.40, Research) warned late Monday that fiscal second-quarter revenue would miss estimates.
Oil stocks were weaker after BJ Services (down $3.67 to $46.58, Research) reported fiscal fourth-quarter earnings that grew from a year ago, but missed estimates. The oil services firm also warned that 2005 results would miss estimates.
Market breadth was mixed. On the New York Stock Exchange, advancers edged decliners by a narrow margin as 1.65 billion shares changed hands. On the Nasdaq, winners and losers were pretty evenly split on volume of 1.85 billion shares.
Treasuries inched higher, pushing the yield on the 10-year note down to 4.06 percent from 4.07 percent late Monday. Bond prices and yields move in opposite directions.
In currency markets, the dollar fell versus the yen and rose versus the euro.
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