US stocks finish mixed
Wall Street's hopes for a turnaround on the stocks have fizzled out after a rally soured in the last hour of trading, resulting in only a minimal lift to blue chips.
Investors once again punished the beleaguered technology sector because of doubts about its future prospects, while expressing displeasure about an announced $25bn merger between Hewlett-Packard and Compaq.
The Dow Jones industrials closed up 47.74, or 0.5%, at 9,997.49, falling back from an earlier gain of 232 points on news of the National Association of Purchasing Management report. It was the index's third straight session to close below 10,000.
Broader stock indicators fell, with early gains dissipating as the session advanced. The Standard & Poor's 500 index slipped 0.64 to 1,132.94, while the technology-laden Nasdaq composite index dropped 34.65, or 1.9%, to 1,770.78.
The lacklustre close marked a frustrating end to a session that had shown much more promise early on.
Fresh from the Labour Day holiday, Wall Street reacted enthusiastically in morning trading to NAPM's report that its index of business activity rose to 47.9 from 43.6 in July. The index was much stronger than the 44.0 analysts had anticipated.
The better-than-expected showing was welcomed by investors desperate for any indication that business is improving after a summer plagued by weak corporate performance and earnings warnings.
Ultimately, however, that news failed to sustain a broad-based market rally as Wall Street retreated into a trading pattern that has frustrated investors for months - and that helped send the Dow and Nasdaq last week to their lowest levels since early April.
Instead of using the advance as a chance to add to their holdings, investors unloaded stocks and cashed in profits for fear the market would not continue to rise.
Tech stocks were hit particularly hard, hampered by questions about whether Dow component Hewlett-Packard's decision to acquire Compaq would reinvigorate slumping business. Hewlett-Packard fell nearly 19%, down dlrs 4.34 to dlrs 18.87, while Compaq dropped dlrs 1.10 to dlrs 11.25. Oracle fell 13 cents to dlrs 12.08, while Microsoft slumped 95 cents to dlrs 56.10.
