US stocks close dwon

Wall Street ended January on a down note today following disappointing gross domestic product figures.

Wall Street ended January on a down note today following disappointing gross domestic product figures. But stocks still eked out modest gains for the month, extending the market’s 2003 run.

The 4% annual growth rate in the fourth-quarter GDP report showed an expanding economy, but the number was lower than the 4.8% analysts expected. The figure was a slowdown from the third quarter’s 8.2%, but no one had expected that rate of growth to be sustained.

“I think the 4% GDP number is a terrific performance,” said Joseph Battipaglia, chief investment officer at Ryan Beck & Co. “There’s still a lot of upside to this market, but there’s a fair amount of short-term investment money that’s pulling momentum to the sell side.”

The Dow Jones industrial average was down 22.22, or 0.2%, at 10,488.07. It was the second straight week of losses for the Dow, which was down 80.22, or 0.8%, for the week.

Broader stock indicators also fell. The Standard & Poor’s 500 index was down 2.98, or 0.3%, at 1,131.13, finishing the week 10.42, or 0.9%, lower and ending a nine-week stretch of gains.

The Nasdaq composite index was down 2.08, or 0.1%, at 2,066.15, losing 57.72, or 2.7%, on the week, its second decline in a row.

January started with a surge in buying throughout the market amid high expectations for the latest round of earnings reports.

But investor enthusiasm dropped when the Federal Reserve changed its stance this week, opening the door for a possible interest rate hike later this year. The resulting sell-off put a big dent in the month’s gains.

For the month, the Dow rose 34.15, or 0.3%, the Nasdaq rose 62.78, or 3.1%, and the S&P climbed 19.21, or 1.7%.

The overall rise in January – marked by weeks of buying followed by a sell-off this week – is good news to those who believe in the “January barometer”.

The barometer holds that a January rise in the S&P will make for a bullish year, and a lower S&P for January means a bear market is at hand.

Since 1950, the barometer has been wrong only five times, with three of those years blamed on world events such as the Vietnam War and the September 11, 2001, attacks.

For the short term, the negative reaction to the GDP report pulled down shares that otherwise would be buoyed by positive earnings news.

ChevronTexaco Corp. was down 96 cents to $86.35 despite reporting a 91% jump in fourth-quarter profits.

Wendy’s International was up 3 cents to $39.73 after reporting a 28% rise in profits, beating analysts’ expectations by 2 cents per share.

Struggling computer maker Gateway Inc. rose 63 cents to $4.72 after it met forecasts by posting an operating loss of 15 cents per share for the fourth quarter.

The company also announced it would buy privately held eMachines Inc for $235 million, creating the US’s third-largest personal computer maker.

Telephone equipment maker Nortel Networks posted its first annual profit since 1997, sending shares $1.24 higher to $7.82. The stock was up 46% for the month.

General Motors dropped $1.03 to $49.68 after Goldman Sachs cut its rating on the stock.

The Walt Disney fell 45 cents to $24.00 after a distribution deal between the entertainment giant and Pixar film studios, maker of the popular films Toy Story and Finding Nemo, was not renewed. Pixar, now free to find other distributors, was up $2.19 to $66.39.

Advancing issues barely outnumbered decliners on the New York Stock Exchange. Volume was light.

The Russell 2000 index of smaller companies was up 0.90, or 0.2%, at 580.76.

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