Posted on: Tuesday, January 25, 2005
Iraq election, oil prices keep investors cautious
By Eileen Alt Powell
Associated Press
NEW YORK — Stocks slumped in listless trading yesterday amid concerns about the upcoming Iraqi election and rising oil prices. The major indexes closed at their lowest levels of the year.
"In general, the market is waiting for the elections in Iraq," said Barry Berman, head trader for Robert W. Baird & Co. "And oil prices have been on the move up for the past week."
Investors in the tech-heavy Nasdaq, which is down 7.66 percent year-to-date, may have been unsettled when chip-making giant Infineon Technologies AG warned that second-quarter earnings could slow. The Munich, Germany-based company reported that first-quarter net profits quadrupled thanks to one-time license income.
The Infineon report "is probably part" of the Nasdaq's malaise, said John Caldwell, chief investment strategist for McDonald Financial Group, part of Cleveland-based KeyCorp. But, he added, the telecommunications sector has also been a problem, with Motorola coming in last week with a cautious outlook and Nokia earnings still awaited.
Investors also continued to eye quarterly earnings results. This week's calendar of releases includes 10 of the 30 Dow industrials, along with more than 150 other major companies.
Declining shares outnumbered advancers by more than 3 to 2 on the New York Stock Exchange.
Market watchers were growing increasingly concerned about January's slide in stocks, which some analysts blamed on Wall Street's strong fourth-quarter performance. A car-bomb attack in Baghdad, targeting the prime minister's party headquarters, did little to ease the anxiety of investors ahead of Iraq's elections on Sunday. Oil prices declined early in the day, but settled up 28 cents at $48.81 per barrel on the New York Mercantile Exchange.
