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Stocks modestly higher ahead of Alcoa report

July 09, 2009|Associated Press

NEW YORK — Stocks finished mostly lower Wednesday after zigzagging for much of the day as investors pondered a mixed outlook on the economy from the International Monetary Fund.

Oil prices tumbled again, reflecting concerns that demand for raw materials will remain weak as the economy struggles.

About two stocks fell for every one that rose on the New York Stock Exchange, but major market indicators ended mixed.

The stock market drew some support from a strong auction of 10-year Treasury notes. The sale allayed worries that the government would have trouble finding enough buyers for the massive amount of debt it is issuing.

Investors seeking the relative safety of government debt also helped push up prices of Treasury securities, sending their yields lower.

The Dow Jones industrials rose 14.81 points, or 0.2%, to 8,178.41. The broader Standard & Poor's 500 index fell 1.47 points, or 0.2%, to 879.56. Both indexes have shed 7% since their recent highs June 12 and are now at their lowest levels since May 1.

The Nasdaq composite index rose 1 point, or 0.1%, to 1,747.17.

The Russell 2,000 index of smaller-company stocks declined 1%.

The market could get a boost today from a narrower-than-expected loss reported by Alcoa, which ushered in the second-quarter earnings season after the closing bell Wednesday.

The aluminum producer's shares rose 6% in after-hours trading.

Traders also will also be watching retail sales figures coming out today to see whether recent declines in indexes of consumer confidence translated into less buying.

The IMF said Wednesday that it expected the world economy to shrink 1.4% in 2009, slightly worse than its earlier estimate of 1.3%.

But the international organization boosted its estimate for global economic growth in 2010 to 2.5%, up from its April projection of 1.9%.

Meanwhile, oil futures fell for a sixth straight day, dropping $2.79 to settle at $60.14 a barrel. Last week, the commodity touched an eight-month high of $73.

In the bond market, the yield on the benchmark 10-year Treasury note sank to 3.29%, a seven-week low, from 3.46% late Tuesday.

Treasury yields have softened in recent weeks after spiking in early June to an eight-month high of 4.01%. The drop in long-term yields since then is good for consumers because yields are closely tied to interest rates on mortgages and other consumer loans.

The dollar mostly rose against other major currencies, while gold prices fell.

Overseas, key stock indexes fell 1.1% in Britain, 0.6% in Germany, 1.3% in France and 2.4% in Japan.

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