Stocks’ Advance After Rate Cut Is Short-Lived
NEW YORK, Jan. 30 — Wall Street closed lower Wednesday, sacrificing the advance it made after the Federal Reserve cut interest rates half a percentage point. Investors collected profits after three sessions of gains, unwilling to leave money on the table during ongoing economic uncertainty.
The Dow Jones industrial average, which had been up more than 200 points after the Fed announced its decision, finished down 37.47, or 0.30 percent, at 12,442.83. The Standard & Poor’s 500-stock index fell 6.49, or 0.48 percent, to 1355.81, and the Nasdaq composite index fell 9.06, or 0.38 percent, to 2349.00.
The rate cuts came on the same day as fresh data that showed the economy slowed significantly in the final three months of 2007. Gross domestic product expanded at a slight 0.6 percent pace in the fourth quarter, less than half of what had been expected. For all of 2007, gross domestic product grew 2.2 percent, the weakest rate since 2002.
On Thursday, the Commerce Department releases its December personal spending report, which includes data on personal con- sumption expenditures.
Key reports on the job market and manufacturing set to arrive Friday could add to investors’ concerns about the state of the economy, which has been dragged down by a crumbling housing market and losses at major financial institutions.
Merck fell $1.32, to $46.69, as charges related to settling lawsuits over the drugmaker’s painkiller Vioxx pushed the company to a fourthquarter loss.
Boeing rose $1.91, to $82.87, after the airplane maker boosted its 2008 profit outlook.
Robert Half International gained $3.13, to $27.98, after the staffing firm posted a 5 percent higher quarterly profit, helped by results abroad.
UBS gave up 79 cents, to $42.26, after Switzerland’s largest bank said it would record the first annual loss in its 10-year history, hurt by the financial climate in the United States.
Yahoo fell $1.76, to $19.05, after the company said that its quarterly profit dropped 24 percent and that it planned to lay off 7 percent of its workforce.
United Parcel Service rose $1.10, $72.02, after posting a fourth-quarter loss.