A renewed push by blue-chip U.S. stocks toward positive territory for the year stalled Wednesday as gains in raw-materials names failed to spill into other sectors.
The Dow Jones Industrial Average has climbed past its 2008 close during four of this month's trading sessions, but it failed to finish above the mark each time. In Wednesday's action so far, it has been stuck in a narrow range, again moving on either side of the psychologically important level.
The average was recently off 13 points, or 0.1%, at 8750.36. At its intraday high, it was up almost 60 points year-to-date.
Among the Dow's components on Wednesday, gains for Alcoa, Chevron and Exxon Mobil were offset by losses for Caterpillar, McDonald's and Wal-Mart.
Other U.S. indexes fared worse than the Dow in percentage terms. The Russell 2000 was off 1.5%, while the S&P 500 was down 0.3% and the Nasdaq Composite Index was off 0.9%.
The prices of aluminum, copper, grains, and other commodities were up in recent action, extending a recent bull run that has raised concerns of inflation among some investors. Oil futures were up $1.28 to $71.29 a barrel in New York following the release of government data showing a bigger drawdown in U.S. stockpiles of crude last week than analysts expected.
For stocks, the Dow's annual break-even level of 8776.39 won't likely stand much longer, especially in light of the market's momentum since early spring and the year-to-date gains that other indexes have already managed to post, said technical analyst Phil Roth, of Miller Tabak & Co.
His current target range for the blue-chip average is 9000 to 9100. But even if the market reaches those levels, which would represent a gain of up to 39% from the Dow's March lows, Roth would still not consider the long-running bear market to be over.
"We still won't really know for sure until we go through another corrective phase," he said. "We have to see what that will look like in this market to get confirmation," that there are enough investors out there with strong conviction that an economic rebound is coming.
Treasurys were mixed in recent action ahead of an auction of $19 billion of notes. Worry about rising supply of government debt has contributed to the recent jump in bond yields, which some fear could choke a recovery if it leads to higher consumer interest rates. The yield on 10-year Treasury note climbed to 3.90%
Traders will look to the Federal Reserve's beige book report, due at 2 p.m., for further evidence that the economy is on the mend. "It will be interesting to see if the anecdotal evidence from this Beige Book corroborates the message from other indicators that the rate of decline in the economy has slowed further," said RDQ Economics analysts in a note to clients.
In overseas action, the Nikkei 225 rose 2.1% in Tokyo to end at its highest level since Oct. 7. The FTSE 100 was up 1.2%.
The dollar strengthened against major rivals. One euro cost $1.40, down from $1.4079 late Tuesday. One dollar fetched 98.05 Japanese yen, up from 97.37 yen.By Peter A. McKay
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