NEW YORK (CNNfn) - Investors shunned the U.S. stock market once again Tuesday after a report on consumer spending stirred just the slimmest of hopes for an economic rebound.
The Nasdaq Stock Market recorded its second-lightest full trading day of the year during a month that has already seen four of 2001's sleepiest sessions. In a market that appears to go nowhere, the Dow Jones industrial average dipped to levels first crossed in April, 1999.
"The data are coming out so mixed it's pretty hard to determine where things are going to go in the short term," Larry Siebert, portfolio manager at Barrett Associates, told CNNfn's The Money Gang.
Retail sales were flat last month, the government reported Wednesday. While that topped forecasts, sales in May and June were revised lower. Home Depot's profit beat expectations, but Wal-Mart said earnings in the current quarter will fall short.
The Nasdaq composite index fell 17.72 points, or less than 1 percent, to 1,964.53. Up 17 percent from its April closing low, but off 20 percent on the year, the Nasdaq has drifted for months.
The Dow industrials fell 3.74 to 10,412.17, a level it first crossed more than two years ago. Blue chips stand more than 1,000 points above this year's low but more than 1,000 points below last year's high.
Meanwhile, the Standard & Poor's 500 index declined 4.56 to 1,186.73, widening its loss to 10 percent on the year.
Market breadth was mixed. On the New York Stock Exchange, advancing issues topped declining ones 1,903 to 1,204 as 953 million shares changed hands. Nasdaq losers led winners 1,831 to 1,790 on volume of 1.2 billion shares.
Treasury securities ended little changed. The dollar fell against the yen and euro.
Wall St.'s rut
In one of the week's most important nuggets of economic data, the Commerce Department reported unchanged July retail sales.
The numbers came during a month when the government began mailing about $38 billion in rebate checks to taxpayers, who also faced lower energy prices, particularly at the gas pump.
Still, rising layoffs and falling stock prices could dampen the sentiment of consumers, whose spending counts for about two-thirds of the economy.
Stocks rose after the report's release. But those gains faded.
"The sales numbers were good, but not good enough to really sustain any rally," said Peter Coolidge, senior trader with Brean Murray & Co. "I think there's some disappointment that things are not picking up more. The market is clearly waiting for more data."
Profit data were mixed. Dow component Home Depot (HD: up $1.20 to $49.30, Research, Estimates) reported a fiscal second-quarter profit of 39 cents a share, 3 cents better than year-ago figures.
But Wal-Mart Stores (WMT: up $0.16 to $52.36, Research, Estimates) warned that earnings in the third quarter will miss forecasts. The nation's biggest retailer earned 37 cents a share in the quarter ended last month, little changed from year-earlier figures and in line with analysts' forecasts.
J.C. Penney (JCP: up $0.10 to $26.49, Research, Estimates) lost 20 cents a share in its second quarter, in line with expectations.
After the close of trading, Applied Materials (AMAT: down $1.19 to $43.65, Research, Estimates), the biggest maker of chip equipment, said it earned 5 cents per share during the quarter ended July 29, a big drop from the 70 cents per share earned in the year-ago period.
Gains in chip stocks Monday handed the Nasdaq its first advance since Aug. 2. But Intel (INTC: down $0.21 to $30.35, Research, Estimates), the No. 1. chipmaker, pulled back Tuesday.
A weaker dollar?
Chris Wolfe, equity strategist at J.P. Morgan, links the day's inactivity to hesitancy ahead of other numbers on the economy and next week's Federal Reserve meeting.
"I think a lot of people are waiting for more economic data later in the week," Wolfe told CNNfn's The Money Gang.
Click here for a look at CNNfn's economic calendar.
In seven days, the Fed is expected to lower borrowing costs for the seventh time this year, taking a closely watched lending rate to levels not seen since 1994.
"I'm looking for a 25-basis-point (quarter-percentage-point) cut," Mickey Levy, economist at Banc of America Securities, told CNNfn's Before Hours.
But Levy sees the central bank leaving rates unchanged following next week's move, ending a rate-cut campaign that began Jan. 3.
The strong dollar has hurt profits among multinational companies, whose exports are tougher to sell as the U.S currency rises. But the euro climbed above 90 cents Tuesday, a three-and-a-half-month high, in a trend that Peter Canelo, U.S investment strategist at Morgan Stanley, predicts will continue.
"I think that's going to be a real plus," Canelo told CNNfn's Street Sweep. 
Click here to send mail to Staff Writer Jake Ulick
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