Split session on Wall Street

NEW YORK (CNNMoney.com) -- The Dow Jones industrial average ended at a record high for the third straight session Tuesday, thanks to a drop in oil prices, but the Nasdaq composite declined, as investors bailed out of select tech shares.

The Dow Jones Industrial average (up 26.51 to 12,582.59, Charts) added 0.2 percent, closing at a record high for the third session in a row. The blue-chip barometer also hit a fresh trading high during the session.

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The S&P 500 (up 1.17 to 1,431.90, Charts) gained a few points, building on the more than 6-year high it closed at last week. The Nasdaq (down 5.04 to 2,497.78, Charts) composite lost roughly 0.2 percent, after ending the previous session at its highest point in nearly six years.

Treasury prices rose, lowering the corresponding yields. Oil prices slumped and gold prices declined.

After the close, Intel (up $0.17 to $22.30, Charts) reported quarterly earnings of 26 cents per share, down from 40 cents a year earlier but a penny more than what analysts were expecting. Shares slumped in extended-hours trading. (Full story).

All financial markets were closed Monday for Martin Luther King, Jr. Day. Stocks rose last week in response to falling oil prices.

Oil prices continued to slide Tuesday, with U.S. light crude oil for February delivery falling $1.78 to settle at $51.21 a barrel on the New York Mercantile Exchange. Prices fell after Saudi Arabia's oil minister said that OPEC production cuts were effective and there was no need for an emergency meeting of the oil cartel.

Oil prices have been sliding since the start of the year, and while that's been a positive for the economy and the inflation outlook, it's been a mixed blessing for the stock market.

"The drop in oil prices in January has helped the rally continue, but has also hurt energy shares," said Timothy Ghriskey, chief investment officer at Solaris Asset Management.

Investors were also skittish Tuesday ahead of a slew of key earnings slated for later in the week, Ghriskey said, and amid questions about the strength of the economy following the morning's weak manufacturing reading.

These factors, in combination with a bull market that is a bit 'long in the tooth,' could mean that the market is due for a little pullback in the short term, Ghriskey said. But longer term, the factors that have supported the most recent leg of the rally remain in place, he said.

They include: growth that appears to be slowing enough to take the edge off inflation, but not send the economy into recession; a Fed that could cut interest rates later this year; lower oil prices; and a strong flow of cash that continues to move into the market.

In addition to Intel, other big companies due to report quarterly results this week include Apple (up $2.48 to $97.10, Charts), IBM (up $1.48 to $100.82, Charts), GE (up $0.22 to $38.11, Charts) and Citigroup (up $0.39 to $54.77, Charts).

Earnings are currently on track to have risen 9 percent in the fourth quarter, according to Thomson Financial. That's a blended figure, combining reported and expected earnings.

Banks Wells Fargo (up $0.72 to $36.23, Charts) and U.S. Bancorp (up $0.20 to $35.75, Charts) both reported quarterly earnings before the start of trading Tuesday that rose from a year ago. Wells Fargo's results met analysts' estimates, while those of US Bancorp were short of estimates.

Among other stock movers Tuesday, Symantec (down $2.69 to $17.79, Charts) slumped in active Nasdaq trading after the web and network security software maker warned that fiscal third quarter and 2007 profit will miss forecasts.

Cisco Systems (down $0.88 to $28.04, Charts) slipped after Prudential downgraded it to "neutral weight" from "overweight," citing limited room for upside surprises in 2007, according to Reuters.

In deals news, GE (up $0.22 to $38.11, Charts) said its buying the aerospace unit of Smiths Group for $4.8 billion in cash.

A number of stocks and sectors reacted to the ongoing decline in oil prices.

Companies that directly benefit from lower energy prices rose, including airlines, with the Amex Airline (Charts) index gaining nearly 2.5 percent.

The Dow Jones Transportation (up 101.57 to 4,861.84, Charts) average also gained on the lower oil prices, adding 2.1 percent.

The decline in oil prices weighed on oil service stocks, with Exxon Mobil (down $1.03 to $71.63, Charts), Valero Energy (down $0.78 to $49.79, Charts) and Sunoco (down $1.07 to $58.76, Charts) all lower.

In other news, an independent panel said BP (down $1.36 to $63.28, Charts) failed to stress safety at its U.S. plants prior to a 2005 Texas City explosion that killed 15.

COMEX gold fell $1 to settle at $625.90 an ounce.

That sent metal and mining stocks lower, including Goldcorp (down $0.51 to $25.68, Charts) and Newmont Mining (down $0.64 to $42.57, Charts). The Amex Gold Bugs (down $3.77 to $316.35, Charts) index lost 1.2 percent.

Market breadth was mixed. On the New York Stock Exchange, losers and winners were roughly even on volume of nearly 1.51 billion shares. On the Nasdaq, decliners topped advancers by eight to seven on volume of almost 2.18 billion shares.

Treasury prices rose, lowering the yield on the benchmark 10-year note to 4.75 percent from 4.77 percent late Friday. Bond prices and yields move in opposite directions.

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

Investors also took in the morning's economic news. The NY Empire State index, a regional read on manufacturing, fell to 9.1 in January from 22 the previous month. Economists surveyed by Briefing.com thought it would fall to 20 in the month.

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