Stocks retreat amid conflicting economic data |

Stocks retreat amid conflicting economic data

NEW YORK – Nervous stock investors collected profits and sold stocks lower Tuesday, wiping out an early advance amid conflicting signals about inflation and consumer spending.The market gave back its gains after the Dow Jones industrials reached an eight-month high. Investors have been uneasy for months about the economy and the effects of inflation, rising interest rates and soaring energy costs, and their anxiety was fed by a Labor Department report that energy costs led a jump in wholesale prices last month. Many decided the safest strategy was to sell.A better-than-expected monthly retail sales report that might have supported the market was undercut by a weak sales outlook from Target Corp.Wall Street’s retreat also came despite crude oil settling below $57 a barrel for the first time since late June. A barrel of light crude dropped 71 cents to $56.50 on the New York Mercantile Exchange.In late afternoon trading, the Dow was off 21.37, or 0.2 percent, at 10,675.80. Earlier in the session, the Dow rose nearly 45 points to reach its highest level since March 15.Broader stock indicators also gave up advances. The Standard & Poor’s 500 index was down 5.77, or 0.47 percent, at 1,227.94, and the Nasdaq composite index declined 15.78, or 0.72 percent, to 2,185.17.Bonds rose, with the yield on the 10-year Treasury note tumbling to 4.56 percent from 4.61 percent late Monday. The dollar was mostly lower against other major currencies, and gold prices were little changed.The market had little reaction to comments from Federal Reserve chair nominee Ben Bernanke, who testified before Congress as part of his approval process. Bernanke said he will continue the policies of current Fed Chairman Alan Greenspan, whose priority has been fighting inflation.It was the specter of higher prices that unnerved Wall Street. The Labor Department’s producer price index – a measure of wholesale prices often seen as a barometer of future inflation – grew 0.7 percent in October as soaring energy prices drove up manufacturers’ costs. Economists were expecting the index to be unchanged last month.Core PPI – setting aside volatile food and energy prices – retreated 0.3 percent, compared with expectations for a 0.2 percent gain and September’s 0.3 percent growth, the department added.Meanwhile, the Commerce Department said retail sales added 0.9 percent in October, excluding the effect of a recent downturn in auto demand. Economists were looking for a 0.3 percent gain, following a 1.1 percent rise the month before.Including car sales, monthly retail sales were down 0.1 percent, the Commerce Department said. That reversed a 0.3 percent increase in September but trounced estimates for a 0.7 percent decrease.Although the overall decline was less than forecast, the retail sector was rattled by Target’s disappointing sales estimate. Target, which said late Monday it expected November sales growth to lag earlier guidance, tumbled $4.22 to $54.21.Other retailers had better news. Home Depot Inc.’s third-quarter profit jumped 17 percent and beat Wall Street estimates by 4 cents per share. The company said sales rose 11 percent, and boosted its estimates for the year. Home Depot, hurt by Target’s forecast, dropped 37 cents to $42.20.Department store J.C. Penney Co. said its earnings surged 57 percent last quarter, but blamed high energy costs for its cautious holiday sales outlook. Penney slid $1.67 to $52.08.Staples Inc. lost $1.04 to $22.82 after the office products supplier said its quarterly profit rose 14 percent, which trailed its earnings growth in recent years.Elsewhere, acquisition activity boosted some healthcare stocks. Johnson & Johnson revised its bid for Guidant Corp. to $21.5 billion, about $4 billion less than the original deal. Last week, Guidant sued Johnson & Johnson for trying to back out as Guidant came under scrutiny for recalls of its implantable heart devices. Johnson & Johnson rose $2.39 to $62.90, and Guidant added $4.94 to $62.69.Allergan Inc., maker of wrinkle treatment Botox, made a $3.2 billion cash and stock proposal for Inamed Corp., which produces breast implants. Inamed previously agreed to be acquired by Medicis Pharmaceutical Corp. for about $2.8 billion. Inamed surged $6.89 to $81.33, while Allergan dropped $2.55 to $96.30 and Medicis slid $3.10 to $26.57.Declining issues outpaced advancers by 23 to 10 on the New York Stock Exchange, where volume of 1.28 billion shares topped the 1.06 billion shares traded at the same point Monday.The Russell 2000 index of smaller companies dropped 7.29, or 1.1 percent, to 656.64.Overseas, Japan’s Nikkei stock average lost 0.17 percent. Britain’s FTSE 100 slid 0.56 percent, Germany’s DAX index gained 0.36 percent, and France’s CAC-40 was lower by 0.12 percent. —On the Net:New York Stock Exchange: http://www.nyse.comNasdaq Stock Market:

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