Wall Street took a summer vacation Monday, refusing to commit to a rally or a pullback.
The Dow Jones industrial average finished up 1.62 points at 3755.43 after trading mixed throughout the day. Generally strong earnings reports and a firming dollar failed to ignite buying enthusiasm.
The Nasdaq index rose 1.26 to 722.62. Volume on the Big Board was a sleepy 227 million shares.
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The yield on the benchmark 30-year U.S. Treasury bond fell four basis points to close at 7.50 percent.
Microsoft led the technology sector higher, gaining $1.87, to $50.50, in the most active trading on the Nasdaq after settling an antitrust case. Though the firm agreed to stop some practices, analysts said it remains free to compete in its usual aggressive style.
Despite the rise in technology stocks, computer benchmark Intel fell 87 cents, to $58.62, apparently on concerns about its second-quarter earnings, due out after the close of the market. When the earnings were released, they showed an unexpectedly good gain for the company.
Intel posted second-quarter profits of $1.46 a share, 2 cents above analysts’ estimates, according to Benjamin L. Zacks of Zacks Investment Research, which tracks such figures. Last year Intel earned $1.30 a share in the same period.
It’s an interesting question whether Intel will get much of a boost for its performance.
Companies ranging from Chase Manhattan to Inland Steel Industries reported earnings above expectations Monday, then saw their share prices languish. Inland had income of 57 cents a share, compared with 30 cents a share for the same period a year earlier.
“We are pleased to report our best quarter in five years as our turnaround activities continue to yield results,” said Robert J. Darnall, Inland’s chairman.
Not so fast, said Wall Street. Inland’s share price closed off 37 cents, at $38.18.
In fairness to Inland, that is a bit misleading. Inland’s stock has run up to a high of $38.50 from a low of $24.75 over the last year.
Nonetheless, the phenomenon of companies reporting excellent earnings to a muted response is widespread.
Some stocks have risen leading up to earnings announcements, one trading executive said.
Companies are forecast to report average earnings increases of 15 percent in the second quarter, according to John Shaughnessy, director of research at Advest.
Don Hays, investment strategist at Wheat First-Butcher & Singer, said that since Wednesday, when reporting of second-quarter corporate earnings began in earnest, 612 companies have weighed in. Of those, 72 percent have posted results above those of last year, he said.
But investors appear to have a growing concern that earnings have peaked.
“This may be the last quarter of favorable earnings comparisons,” said David Bostian, market strategist at Herzog Heine & Geduld. “The momentum is going to turn down in the third quarter.”
Not everyone got creamed for doing a good job. Wabash National, a maker of truck trailers, gained $2.62, to $52, after reporting earnings of 53 cents a share for the second quarter, up from 32 cents a year ago and substantially above estimates of 49 cents.
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Rust International’s stock took a dive following a lower-than-expected earnings report. The company, a majority-owned unit of WMX Technologies of Oak Brook, reported earnings of 20 cents a share, down from 26 cents a share the year before, a nickle below analysts’ estimates.
Rust stock fell $2.75, to $14.12.
WMX, due to report earnings Tuesday, slid 12 cents, to $27.62, in sympathy.
To take a break from this, there’s good news on the Italian front. Chicago’s Italian-American Chamber of Commerce has been named representative for the Milan Chamber of Commerce covering the 17-state Midwest area. The 87-year-old Chicago chamber also was named to represent the Fiera Milan, the Milan trade fair center.