Industrials abandons 10,000 level after U. of Michigan sentiment index drops unexpectedly.
December 12, 2003: 9:52 AM EST
NEW YORK (CNN/Money) - The Dow dipped below the 10,000 level Friday morning amid some profit taking and a weaker-than-expected consumer sentiment number.
After 20 minutes of trading, the Dow Jones industrial average (down 15.04 to 9993.12, Charts), the S&P 500 (down 2.32 to 1068.89, Charts) index and the Nasdaq composite (down 6.52 to 1935.80, Charts) all turned lower after posting modest gains in the early going.
The University of Michigan's preliminary reading on consumer sentiment in December showed a drop to 89.6 from 93.7 the previous month. Economists were expecting a rise to 96.0.
A broad market rally found its second wind in the afternoon Thursday, pushing the Dow to a better-than-10,000 close for the first time since May 24, 2002, when it closed at 10,104.26. Although not a key technical level, it is a key psychological barrier, analysts say, and the close above 10,000 could bring in more buyers in the next few weeks.
In the morning's economic news, the producer price index, a measure of wholesale inflation, fell 0.3 percent following an 0.8 percent gain in October. Economists were expecting a rise. The so-called "core" PPI, which excludes food and energy prices, fell 0.1 percent after rising 0.5 percent in October. Economists were expecting it to be flat.
A separate report also showed that the U.S. trade gap widened due to a record number of imports, but investors seemed to mostly ignore that.
Among early movers, graphics chipmaker Adobe Systems (ADBE: up $1.14 to $40.92, Research, Estimates) gained almost 5 percent. Late Thursday, the company reported a better-than-expected fourth-quarter profit of 34 cents that grew from a year earlier, and also raised its first-quarter earnings-per-share forecast. Shares rose 3 percent in after-hours trade.
Treasury prices edged lower, pushing the 10-year note yield up to 4.23 percent from 4.22 percent late Thursday. The dollar edged lower against the yen and euro.
Brent oil futures rose 31 cents to $29.59 a barrel in London. COMEX gold gained $2.10 to $407.50.
Asian markets rose Friday. European markets were mostly higher at midday.
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