Stocks snapped a three-day winning today as a disappointing earnings report from Amazon.com and mixed messages from the latest batch of economic data drove shares lower.
The Dow dropped 3.69 points, or 0.03 percent, to 10,593. The Nasdaq lost 17.42 points, or 0.84 percent, to 2,057.64. The S&P 500 dropped 3.30 points, or 0.28 percent, to1,189.89.
Hurting the Nadaq was a disappointing fourth quarter earnings report from Amazon.com. The e-tailer saw its shares plummet nearly 15 percent to US$35.65 after warning that it would spend millions more this year to keep its free and low-cost shipping offers in place to keep customers coming back.
Productivity Gains Slow
Investors might also have been behaving with caution ahead of the January employment figures due out tomorrow morning.
On the economic front, a report out today showed that gains in productivity that have helped drive corporate profits in recent years began to slow at the end of 2004. The Labor Department said productivity rose just 0.8 percent in the fourth quarter, and for all of 2004 rose 4.1 percent, the smallest increase since 2001.
Slowing productivity growth could lead to inflation by pressuring businesses to hire more workers in order to meet growing demand.
Meanwhile, the International Council of Shopping Centers said retailers will likely turn in better than expected sales results for January, though some chains might still disappoint. Wal-Mart said its sales outpaced forecasts for the month.
The dollar had a strong day against the yen and euro, which some ascribed to President Bush’s pledge in his State of the Union address to halve the U.S. budget deficit within four years.
Meanwhile, oil prices continued their recent retreat, dropping another 24 cents per barrel to $46.45.