MW: U.S. stocks lose traction as rally in energy fizzles
U.S. stocks pared an early rise as a rally in energy shares lost steam as crude-oil futures dipped to under $49 a barrel and as investors digested new data that largely confirmed a bleak view of the nation's economy.
The reports included separate data on factory orders and pending home sales for November, as well as the Institute of Supply Management's non-manufacturing index for December.
The equities market "came off its best levels of the day following what analyst Frederic Ruffy called "another round of uninspiring economic data."
"Yet, while the economic headlines remain grim, stocks are holding higher in quiet trading because a lot of the bad news was already discounted when the stock market crashed in 2008," said Ruffy, options strategist, at WhatsTrading.com.
The Dow Jones Industrial Average fell 10.27 points to stand at 8,942.62, with 13 of its 30 components sliding into the red.
Oil futures turned tail on their recent climb, and were off 67 cents to $48.14 a barrel after an earlier rise above $50 a barrel. Read Futures Movers.
The S&P 500 was only fractionally higher at 927.61, and the Nasdaq Composite rose 8.94 points to 1,636.97.
For Sale
Indicating further softening could be in store for the U.S. housing market, the National Association of Realtors' index of sales contracts on previously-owned homes fell 4% in November from the prior month.
The Commerce Department said shipments from U.S. factories declined a record 5.3% in November, with the tally confirming a slump in factory activity seen in other reports. See details.
The ISM services index showed nonmanufacturing sectors contracted at a slower pace in December. Read Economic Report.
Later, at 2 p.m. Eastern, minutes from the Federal Reserve's mid-December policy-setting meeting are slated for release.
An early glimpse of the recession's toll on consumer spending came from the International Council of Shopping Centers and Goldman Sachs, which said chain-store sales fell 0.8% last week from the year-ago period.
On the corporate front, Dow Chemical Co. said it would pursue legal action against Kuwait's Petrochemical Industries Inc. over the unraveling of a joint venture. Shares of Dow Chemical gained 3% in the early going. See detailed report.
In another illustration of the global recession, Switzerland's Logitech International SA withdrew its financial targets for the year, and said it would cut its workforce by 15%. The maker of computer mice also warned of a worsening economic climate ahead. Read full story on Logitech.
In Asia, shares of Japanese and South Korean automakers advanced. See Asia Markets.
Pharmaceutical firms led equities higher in Europe. Read Europe Markets.
U.S. equities on Monday declined, bringing to an end a three-session winning streak, with the Dow shedding 81.8 points to 8,952.89, off nearly 37% from its record close hit on Oct. 9, 2007. The S&P 500 and the Nasdaq Composite both gave up 4 points.
