Stocks keep struggling
Lower crude prices continue to weigh on oil stocks with no major economic reports on tap, while techs remain in focus.
NEW YORK (CNNMoney.com) -- Stocks pared some of their early losses Tuesday but remained lower as investors weighed the impact of lower energy prices and braced for corporate earnings.
The Dow Jones industrial average (Charts) and the S&P 500 index (Charts) both lost close to 0.4 percent with 2-1/2 hours remaining in the session. The Nasdaq composite (down $3.98 to $2,434.22, Charts) lost 0.2 percent.
Investors were awaiting fourth-quarter earnings from aluminum maker Alcoa (up $0.07 to $28.55, Charts) which is expected to report after the closing bell. The aluminum maker will be the first Dow Jones industrial average component to report results for the period ended Dec. 31.
But investors struggled Tuesday, with the further decline in oil prices having a mixed impact on stocks.
"A lot of oil stocks in the S&P are getting hurt and so the impact of the falling oil prices is less positive than it might otherwise be," said Steven Goldman, market analyst at Weeden & Co.
Investors don't know whether the oil selloff is temporary or whether prices could spring back up again. Last summer, oil prices were up above $70 a barrel.
Oil prices have been tumbling for the last week in response to unusually warm Northeast weather and bets that large hedge funds are cutting their exposure to the sector.
Lower oil and gas prices mean more money for consumers to spend on other things, and lower costs for corporations.
Airlines, which directly benefit from lower fuel costs, rose Tuesday, with the Amex Airline index adding more than .5 percent.
But oil services companies were under pressure, with the Amex Oil index down over 1 percent.
Shares of BP (down $1.67 to $62.62, Charts) slipped after the oil major said its oil and gas production fell 5 percent in the fourth quarter of 2006 compared to last year, sparking fears about the company's growth potential.
A number of tech companies were in focus due to a pair of big conferences happening on the West Coast.
Apple (up $4.71 to $90.18, Charts) shares jumped over 2.5 percent after CEO Steve Jobs announced during his keynote speech at Apple Computer's annual Macworld expo in San Francisco that the iPod maker would launch a cell phone which he called the "iPhone," with iPod, cell phone and "Internet communicator" capabilities.
In addition, investors were attuned to news coming out of the Las Vegas-based Consumer Electronics Show, currently underway.
The telecom said 2006 revenue will be roughly in line with previous estimates and 2007 revenue will fall in a range that sets the midpoint below analysts' forecasts. Sprint also said that it will cut about 5,000 jobs next year.
Market breadth was negative. On the New York Stock Exchange, decliners topped advancers three to two on volume of 1.01 billion shares. On the Nasdaq, losers surpassed winners by nine to five on volume of 1.28 billion shares.
Treasury prices were barely changed, with the yield on the benchmark 10-year note at 4.65 percent. Bond prices and yields move in opposite directions.
In currency trading, the dollar rose against both the euro and the yen.
COMEX gold rose $4.40 cents to $613.80 an ounce.