Stocks slip on the gloom

The Associated PressAugust 21, 2010 

— Stocks closed moderately lower Friday as investors' pessimistic view of the economy deepened.

There was little reason for investors to buy. There were no reports to offset Thursday's disappointing news that growth in the domestic economy continues to slow. The Dow Jones industrial average fell 57 points a day after falling 144. The other major indexes also fell moderately.

"We're not seeing any significant growth prospects," said Peter Costa, president of Empire Executions. "Why be in the market if there's no [near-term] prospects for growth?"

Oil prices fell again on worries that future demand will wane if economic growth remains tepid. Energy stocks were among the worst performers on the day, including oil companies Chevron and ConocoPhillips.

Overseas markets also fell, reacting to reports Thursday that initial claims for unemployment benefits in the U.S. rose last week and manufacturing in the Mid-Atlantic region shrank.

"We're probably on a continuation from yesterday's disturbing claims number," said Paul Zemsky, head of asset allocation at ING Investment Management. "There's really nothing to hang your hat on."

The Dow fell 57.59, or 0.6 percent, to 10,213.62. The Standard & Poor's 500 index fell 3.94, or 0.4 percent, to 1,071.69, while the Nasdaq composite index rose 0.81, or 0.04 percent, to 2,179.76.

Traders' vacations have left volume exceptionally low this month. The uncertainty about the economy has made those who are working hesitant to make any major moves.

In corporate news, Dell reported a better-than-expected profit Thursday, due largely to increased technology spending by businesses. However, sales in its consumer personal computer division were flat compared with the same quarter last year - further evidence that shoppers are hesitant to buy new goods.

Hewlett-Packard reported quarterly results that were in line with preliminary results it released earlier in the month. Its profit rose 6 percent. Unlike Dell, it had growth in its personal computer sales.

Overseas, Britain's FTSE 100 fell 0.3 percent, Germany's DAX index dropped 1.2 percent, and France's CAC-40 fell 1.3 percent. Japan's Nikkei stock average fell 2 percent.

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