Profit news sends Dow down 226 |
| CNN Money - Jul 25, 2007 |
Wall Street seesawed Wednesday as investors weighed signs of a worsening housing market and lending climate against strong earnings from Amazon.com Inc. (NASDAQ:AMZN) and Boeing Co. (NYSE:BA)
The stock market -- lurching up, down, and then up again -- still appeared jittery after Tuesday's 226-point tumble in the Dow Jones industrial average. The big drop was triggered by a few disappointing profit reports and forecasts, notably from mortgage lender Countrywide Financial Corp. (NYSE:CFC)
The National Association of Realtors on Wednesday confirmed that the housing market is far from recovery when it reported that sales of existing homes dropped 3.8 percent in June to the slowest rate in more than 4 years. The figure was worse than analysts expected, and followed data from the Mortgage Bankers Association showing mortgage applications fell for the first time in four weeks to a five-month low.
Some market watchers worry that deteriorating lending conditions will cork this year's huge stream of dealmaking. Still, the acquisitions keep coming: Siemens (NYSE:SI) AG Wednesday said it will sell its VDO auto parts unit to Germany's Continental AG in a $15.67 billion deal.
Wall Street is trying to assess whether problems involving risky home lending will hurt the broader economy.
'It's an open-ended unknown, and that's the problem,' said Richard E. Cripps, chief market strategist for St. Louis-based broker Stifel Nicolaus. He added, though, the stock market's volatility is not necessarily a bad thing. 'It's shaking a tree, and it's shaking out the bad apples, shaking out investors' concerns. The overall picture is pretty constructive for equities.'
In late morning trading, the Dow Jones industrial average rose 51.87, or 0.38 percent, to 13,768.82, after trading up more than 100 points in early trading and then trading down more than 30.
Read Full Article from CNN Money
- Posted: 2007-07-25 12:54:37
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