WESTON, Fla., May 13, 2004 (PRIMEZONE) -- Stocks got off to a negative start of Thursday as concerns over the price of crude continued to weigh on investors, and economic data came in showing an unexpected jump in producer prices, and decline in retail sales. The Nasdaq Composite was down 1.5 points in early dealings, to 1,927, while the Dow Jones industrial average started the day with a decline of 57 points, to 9,990.
Investors' concerns over the price of crude are playing out in trading, with the major averages mired in the red once again in early trading Wednesday. Also damaging investor confidence were Commerce Department figures showing the U.S. trade deficit widened by 9.1 percent to a record $46 billion, much higher than what analysts were expecting.
Stocks in the news include Qualcomm (Nasdaq:QCOM) whose finance chief says chip supply is catching up with customer demand.
And Mamma.com (Nasdaq:MAMA) were soaring once again in early dealings Thursday, jumping about 25% on news the search engine made a quarterly profit.
Wal-Mart's (NYSE:WMT) first-quarter earnings came in better than analysts expectations, boosted by strong sales in its higher-margin clothes category. Net income was $2.17 billion, or 50 cents a share in the latest quarter.
And Pfizer (NYSE:PFE), which is said to have reached an agreement to settle its Medicaid fraud case, was active in early morning dealings.
The latest Federal Open Market Committee meeting was held on Tuesday, May 4, 2004, where the FOMC changed its tune somewhat, saying in its statement that "The Committee perceives the upside and downside risks to the attainment of sustainable growth for the next few quarters are roughly equal. Similarly, the risks to the goal of price stability have moved into balance. At this juncture, with inflation low and resource use slack, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured."
In plain terms The Fed is saying that conditions have improved to the point that rates can start moving up from their current historically low levels, but will probably do so at a measured, and even pace. . . . no 50 and 75 basis point hikes in the near future. The Fed also said it "continues to believe that an accommodative stance of monetary policy, coupled with robust underlying growth in productivity, is providing important ongoing support to economic activity." Regardless, many analysts are saying the first rate increase may come as early as June.
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