Stocks Narrowly Mixed Ahead of Iraq War
By AMY BALDWIN, Associated Press
Last updated: 11:10 a.m., Tuesday, March 18, 2003
NEW YORK -- Cautious investors took profits from a big four-day rally and did little buying Tuesday in advance of war with Iraq. Stocks were narrowly mixed.
In late morning trading, the Dow Jones industrial average was up 4.06, or 0.1 percent, at 8,145.98 after rising by a stunning 617.86 in the previous four sessions. But the broader market was lower. The Nasdaq composite index fell 5.80, or 0.4 percent, to 1,386.47. The Standard & Poor's 500 index declined 1.84, or 0.2 percent, to 860.95.
President Bush told the nation Monday night that he would order a massive military strike unless Saddam Hussein goes into exile by Wednesday evening. He also warned the nation about terror attacks and announced that the White House was raising the terror alert to orange, the second-highest level.
On Tuesday, Iraq's leadership rejected Bush's demands.
Stocks have been rallying since last week on investors' growing hopes that war would be short and successful, spurring business and consumer confidence. Analysts have said, however, that stocks will have a difficult time holding onto rallies as long as there is uncertainty about war.
Investors were awaiting a decision on interest rates from the Federal Reserve later Tuesday amid some speculation that the central bank would lower rates by another 0.25 percentage point. The Fed has lowered rates 12 times since early 2001 in an effort to reinvigorate the economy.
Meanwhile, Tuesday's data on the economy was downbeat as the Commerce Department reported that new housing construction plunged by 11 percent in February, the sharpest decline in nearly a decade.
Home builders were subsequently among Wall Street's decliners. Centex fell 62 cents to $51.98 and Lennar stumbled 55 cents to $51.50.
Investors also took profits from oil companies after bidding them higher on the belief that oil prices will decline after the situation with Iraq is resolved. ConocoPhilips fell 96 cents to $50.04 after First Albany downgraded the oil and gas company to "sell."
Among the market's winners, LaBranche rose 55 cents to $18.90 after Raymond James upgraded the trading specialist firm to "outperform."
Applied Materials advanced 18 cents to $13.31 after the chip equipment maker announced a restructuring plan that including cutting its work force by 14 percent, or 2,000 employees.
Advancing issues matched declinerson the New York Stock Exchange. Volume was light.
The Russell 2000 index, which tracks smaller company stocks, fell 0.47, or 0.1 percent, to 364.93.
Overseas, Japan's Nikkei stock average finished Tuesday up 1.1 percent. In Europe, France's CAC-40 declined 2.2 percent, Britain's FTSE 100 rose 0.4 percent and Germany's DAX index gained 1.6 percent.