Posted on: Wednesday, September 1, 2004
Stocks slowed by drop in consumer confidence
By Michael J. Martinez
Associated Press
NEW YORK — A late-session buying spurt gave stocks a moderate lift yesterday as investors managed to overcome their disappointment over troubling readings on consumer confidence and manufacturing. But with volume extremely light, analysts said it was difficult to place any real significance on the upturn.
With oil prices extending their losses, buyers did move back into the market at the end of the session. Still, the turnaround was likely exaggerated because of the light turnover; many investors are staying out of the market entirely during the Republican National Convention. Advancing issues outnumbered decliners by more than 2 to 1 on the NYSE, on a volume of 1.55 billion shares, compared with 1.06 billion on Monday.
The major indexes ended August with the Dow rising 0.3 percent and the S&P 0.2 percent, while the Nasdaq tumbled 2.6 percent for the month.
"We're starting to see some reinforcement in the economic data that this is more than just a soft patch for the economy," said Michael Chren, senior director of value equity investment for the Armada Funds. "I think Friday we'll have another very powerful data point with the jobs figure (the government's August employment report) coming out, and if that's lower than expected, that will really throw fuel on the fire."
The plunge in the Conference Board's consumer confidence index, to 98.2 in August from 105.7 in July, raised concerns on Wall Street that a lack of new jobs could extend the summer's economic slowdown through the third quarter, or perhaps longer. Data on Midwest manufacturing activity also showed a sharp decline for the month.
