While you were sleeping: Stocks slip on Cisco

While you were sleeping: Stocks slip on Cisco

(BusinessDesk) February 11 - Stocks on Wall Street were lower, led by disappointing results from Cisco Systems Inc., though analysts said it appeared that investors were still keen to buy.

Investors also were closely eyeing reports that Egyptian President Hosni Mubarak was likely to step down today, removing one uncertainty from the markets.

Mubarak would speak to the nation from his Cairo palace later in the day, Egypt's state television said. Egypt has been thrown into chaos after more than two weeks of protests against his 30-year rule.

In early afternoon trading, the Dow Jones Industrial Average fell 0.27%, the S&P 500 Index declined 0.11% and the Nasdaq Composite Index shed 0.07%. Wall Street had pared some of the early session’s losses by early afternoon.

Cisco was the biggest drag on the Dow after earnings missed analysts’ expectations. Also disappointing was PepsiCo Inc, which cut its full-year earnings growth target.

And in Europe, Credit Suisse Group AG missed profit expectations.

Still, analysts believe that the mood is positive.

"The pattern that we have been seeing recently is that we don't see selloffs that last very long. They are being bought. Investors are buying on the dips," Howard Ward, chief investment officer of Gamco Growth Fund in New York, told Reuters.

According to Larry McMillan of McMillan Analysis Corp, 93% of traders in an industry survey were bullish on the S&P 500 futures on Tuesday, but the number fell to 90% at Wednesday's close. A drop below 90%, accompanied by a down day in the market, would be a sell signal.

Adding to the overall sense of optimism, U.S. claims for first-time jobless benefits fell more than expected in the latest week to a 2-1/2-year low, data showed today.

Even so the U.S. economic recovery still needs help.

In another sign that the Federal Reserve was going to see through its efforts to bolster U.S. economic growth, Kevin Warsh unexpectedly resigned from the central bank.

Warsh has been the only governor at the bank to question Chairman Ben Bernanke’s stimulus strategy. Warsh, 40, has been at the bank for five years.

The euro traded 0.7% lower at US$1.3628.

The U.S. dollar was up for a seventh straight session against the yen, up 0.8% to 83.10 yen.

Oil traded lower on Thursday, with Brent crude falling nearly US$1 to about US$101.

OPEC reported it has lifted its oil output to a two-year high, encouraged by rising global demand and prices above US$100 a barrel, while the industrialized world's energy adviser said the increase may limit price gains.

In a monthly report, the Organization of the Petroleum Exporting Countries said its January production rose by 400,000 barrels per day to 29.72 million barrels per day, the highest since December 2008 when the group announced a record production cut.

(BusinessDesk)

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