US stocks slip

Stocks slumped on Wall Street today as lower-than-expected retail sales and a disappointing forecast from Intel offset upbeat earnings news from McDonald’s and other companies.

Stocks slumped on Wall Street today as lower-than-expected retail sales and a disappointing forecast from Intel offset upbeat earnings news from McDonald’s and other companies.

A string of profit warnings from semiconductor companies have worried the equity markets for more than a week, and the picture looked bleaker after chip bellwether Intel released its results late yesterday.

The market’s tone seemed to temporarily improve following McDonald’s midday announcement, but the advance was short-lived.

But analysts remained optimistic.

“Despite all the worries, I think the earnings numbers will be spectacular,” said Joseph Battipaglia, chief investment officer at Ryan Beck & Co. “Investors should not get discouraged because of the results of one company.”

The Dow Jones industrial average dipped 38.79, or 0.4%, to 10,208.80.

The broader gauges also finished lower. The Nasdaq composite index shed 16.78, or 0.9%, to 1,914.88. The Standard & Poor’s 500 index was down 3.67, or 0.3%, at 1,111.47.

In addition to the negative sentiment surrounding earnings, a discouraging report on retail sales also held buyers back. Sales at US retailers fell 1.1% in June, the sharpest decline in 16 months, the Commerce Department said. Economists blamed bad weather, higher energy prices and slower payroll growth.

The pullback followed a 1.4% rise in May.

Intel sank 2.76, or 11%, to 23.38 after the chip-maker said 2004 profit margins would be lower than expected as it works through a buildup of inventory.

The outlook led several brokerage firms to downgrade the company, even though it matched earnings estimates and reported a surge in revenue on robust demand for cell phone memory chips.

McDonald’s gained 1.11 to 27.79 after the fast food chain said June sales growth at its restaurants around the world would help it beat Wall Street’s earnings estimates for the second quarter.

Juniper Networks added 2.59, or 12%, to 24.59, after the network-equipment maker said it expected third-quarter earnings and revenue to come in ahead of analysts’ estimates.

Genzyme gained 5.50, or 12%, to 50.00, after the pharmaceutical company beat earnings estimates and reported a 585 rise in second-quarter revenues and projected higher annual sales.

Bank of America lost 83 cents to 84.30 after blowing past earnings expectations, buoyed by results from recently acquired FleetBoston Financial.

But some analysts questioned the quality of its profits, noting that a significant portion was due to securities gains instead of the bank’s primary business.

Harrah’s Entertainment Inc fell 1.00 to 50.98 on reports that it was close to an acquisition of rival Caesars Entertainment. The deal would make Harrah’s the largest gambling company in the world. Caesars was up 2.08, or 15%, at 16.00.

Declining issues outnumbered advancers on the New York Stock Exchange. Volume was moderate.

The Russell 2000 index, which tracks smaller company stocks, ended the day down 2.95, or 0.5%, at 559.74.

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