US stocks finished another volatile session mixed today, as gains in the energy, utilities and materials sectors offset some of Wall Street’s angst over the fate of Lehman Brothers.
The three major indexes all managed to end the week higher.
The troubles of the financial sector dominated trading, as investors tried to glean insights into Lehman’s race to sell itself or otherwise regain Wall Street’s confidence. The company’s shares have spiralled lower this week, heaping pressure on executives at the number four US investment bank to line up a buyer or source of fresh cash.
Lehman shares – which tumbled 42% yesterday and are down more than 94% for the year – fell another 57 cents, or 13.5%, to 3.65 on today.
Sluggishness in buying is an unnerving prospect for Wall Street because consumer spending accounts for more than two-thirds of US economic activity. Macy’s fell 1.04, or 4.8%, to 20.81, while Best Buy fell 1.51, or 3.3%, to 44.49.
Not all the economic news was unwelcome today. Another government report showing a bigger-than-expected drop in wholesale inflation – the steepest decline in nearly two years – at least eased some worries about pricing pressure. And a Reuters/University of Michigan survey on sentiment showed consumers are more upbeat than they were earlier in the summer when energy prices were higher.
Beyond the financial sector, energy and materials names advanced, such as Dow components Exxon Mobil, which rose 1.94, or 2.6%, to 77.50, and Alcoa, which rose 1.05, or 3.8%, to 28.67.
Ford Motor rose 23 cents, or 4.9%, to 4.91, while Dow component General Motors rose 26 cents, or 2%, to 13.01. A Goldman Sachs analyst wrote to in a note to clients that “it is more likely than not” that a loan programme for carmakers could receive at least partial funding before Congress adjourns this autumn.
Declining issues outnumbered advancers by about 9 to 7 on the New York Stock Exchange, where volume came to 1.31 billion shares.
The Russell 2000 index of smaller companies rose 1.26 or 0.18%, to 720.26.