Posted on: Friday, July 2, 2004
Stocks slide on jobless, manufacturing reports
By Meg Richards
Associated Press
NEW YORK — Stocks sagged yesterday as lower-than-expected activity in the manufacturing sector and a slight rise in weekly jobless claims stifled investor enthusiasm after two days of gains. The Dow Jones industrials lost more than 100 points, while tech stocks fell on concerns about Intel Corp. and Yahoo Inc.
"I would not read too much into this weakness today, because there's a real lack of engagement overall," said Brian G. Belski, market strategist at Piper Jaffray. "I don't think there's any sense of urgency right now, today, ahead of the employment report, post the interest rate decision and in a holiday week, to put a lot of new money to work."
The Labor Department found a slight rise in people who signed up for jobless benefits last week; economists had forecast a decrease in claims. Wall Street was waiting for the government's monthly labor report, due today. Analysts expect 250,000 new jobs and a steady unemployment rate of 5.6 percent for June.
Separately, the Institute for Supply Management said its manufacturing index declined to 61.1 in June, down from 62.8 in May. The reading was somewhat lower than the 61.5 forecast.
Investors reacted positively Wednesday to the Federal Reserve's move to raise rates by 0.25 percentage point, largely because the decision had been so widely expected. Now they are free to focus on corporate profits.
Declining issues outnumbered advancers by almost 2 to 1 on the New York Stock Exchange. Final consolidated volume came to 1.84 billion, compared with 1.89 billion Wednesday.
The decline did not alarm analysts much, as trading volume was lower ahead of the holiday weekend. After the market's muted reaction to a widely expected rise in interest rates Wednesday, many investors were looking ahead to a labor report today.
