Wall Street dips after year's best two-day run, Fed eyed

NEW YORK Mon Jul 30, 2012 5:12pm EDT

Traders work on the floor of the New York Stock Exchange, July 27, 2012. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange, July 27, 2012.

Credit: Reuters/Brendan McDermid

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NEW YORK (Reuters) - Stocks finished mostly flat on Monday as investors paused following the best two-day run this year, with central bank meetings and a full load of U.S. economic data looming.

Traders have bet that the Federal Reserve and the European Central Bank will suggest further action to stimulate their economies is on the way when each meets later this week.

The sectors least sensitive to economic growth - telecoms, consumer staples and utilities - posted healthy gains, suggesting a cautious move to defensive plays.

Blue chips like Wal-Mart Stores (WMT.N) and AT&T (T.N) hit new 52-week highs. Wal-Mart rose 0.6 percent to end at $74.98 after hitting $75.24 earlier. AT&T added 0.8 percent to close at $37.43 after hitting $37.69.

Last week, a strong statement from ECB President Mario Draghi drove the Dow above 13,000 for the first time since early May, and gave the S&P 500 its biggest two-day rally since December.

"With all that news later in the week and after the big run, I think there's probably a little bit of hesitation to run ahead of these numbers," said Janna Sampson, co-chief investment officer at OakBrook Investments in Lisle, Illinois.

The Fed begins a two-day meeting on Tuesday while the ECB will meet on Thursday. The U.S. economic calendar is heavy this week, including Friday's payrolls report for July.

The Nasdaq Composite underperformed the other major indexes, weighed down by a 5.9 percent drop in shares of Citrix Systems (CTXS.O) and a 1 percent fall in Intel (INTC.O).

The Dow Jones industrial average .DJI dipped 2.65 points, or 0.02 percent, to 13,073.01 at the close. The Standard & Poor's 500 Index .SPX edged down just 0.67 of a point, or 0.05 percent, to 1,385.30. The Nasdaq Composite Index .IXIC fell 12.25 points, or 0.41 percent, to end at 2,945.84.

About 5.5 billion shares changed hands on the New York Stock Exchange, the Nasdaq and the Amex - 18.5 percent below the year-to-date daily average of 6.75 billion shares through last Friday.

On the NYSE, decliners slightly outnumbered advancers by 1,520 to 1,460. On the Nasdaq, 1,586 issues fell while 883 shares rose.

Apple Inc (AAPL.O) climbed 1.7 percent to $595.03. Jury selection began on Monday in a high-stakes patent battle between the iPad maker and Samsung Electronics (005930.KS), the culmination of over a year of pre-trial jousting with billions of dollars in the balance.

According to Thomson Reuters data, of the 294 companies in the S&P 500 that have reported second-quarter earnings to date, 67 percent have posted earnings above analysts' expectations. Over the past four quarters, the average is a 68 percent beat rate.

Shaw Group SHAW.N surged 55.5 percent to $41.49 after the engineering company agreed to be acquired by Chicago Bridge & Iron Co (CBI.N) for about $3 billion in cash and stock.

Progenics Pharmaceuticals Inc (PGNX.O) plunged 50.1 percent to $5.39 and Salix Pharmaceuticals Ltd (SLXP.O) tumbled 13 percent to $46.25 after the U.S. Food and Drug Administration declined to approve wider use of one of their drugs and asked for more data.

(Reporting by Rodrigo Campos; Editing by Jan Paschal)

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Comments (2)
Jose3 wrote:
When people realize that the hot air holding up the Euro is was just that, the Euro will shoot below $1 US.

Jul 30, 2012 9:25am EDT  --  Report as abuse
divinargant wrote:
I’m guessing the Fed will signal nothing beyond what they already have to this point with regard to further easing in their rhetoric this week. The real bottom pincher for investors this week is what comes out of the ECB. I’ve got this feeling that investors are going to be very disappointed when Draghi has nothing more concrete to offer up than he did at his last blustering moment backing the Euro. If he in fact has no details to offer up and only rhetoric to serve up, yields will spike and equities will plummet.

Jul 30, 2012 6:08pm EDT  --  Report as abuse
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