Stocks fluctuated but showed some signs of stability Monday as Wall Street, still anxious that a credit crunch will crimp U.S. growth, struggled to recoup some of last week’s steep losses.
Some strong earnings reports and merger-and-acquisition activity appeared to steady the market, which is coming off the Dow Jones industrial average’s and Standard & Poor’s 500 index’s biggest weekly drops in five years. The Dow has fallen about 5 percent since closing at a record of 14,000.41 on July 19, caving under worries about a shakier lending climate.
Health benefits provider Humana Inc. and meat producer Tyson Foods Inc. both reported better-than-expected quarterly profit gains, while HSBC Holdings PLC, Europe’s largest bank by market value, said earnings for the first half of the year rose 25 percent.
And in a sign that dealmaking hasn’t yet been stanched by debt aversion, industrial equipment manufacturer Ingersoll-Rand said it’s selling its Bobcat earth-moving division and two other units to Korea’s Doosan Infracore for $4.9 billion.
But not all of Monday’s news was positive: China tightened its credit again by ordering banks to hike their reserves, and RadioShack Corp. posted a 15 percent decline in sales.
The market fluctuated between positive and negative territory Monday, indicating that a high level of nervousness remains on Wall Street, said Kim Caughey, equity research analyst at Fort Pitt Capital Group. “The mythical investor vascillates between fear and greed,” she said, noting that she regards last week’s plunge as an opportunity to buy, albeit selectively.
By late morning, the Dow fell 22.11, or 0.17 percent, to 13,243.36, after rising in earlier trading. On Thursday and Friday, the Dow fell a total of 585 points.
Broader stock indicators also declined. The Standard & Poor’s 500 index fell 1.36, or 0.09 percent, to 1,457.59, and the (MORE)