Plus   Neg

Major Averages Close Firmly Negative But Off Worst Levels

After seeing considerable volatility in morning trading on Thursday, stocks moved mostly lower in the afternoon and ended the day in the red. A batch of largely disappointing U.S. economic data weighed on the markets, offsetting positive sentiment generated by some upbeat banking earnings.

Telecom stocks saw substantial weakness on the day, dragging the NYSE Arca Telecom Index down by 4.3 percent. With the loss, the index ended the session at its lowest closing level in over a month.

Qualcomm (QCOM) turned in one of the telecom sector's worst performances, tumbling by 6.6 percent after reporting better than expected second quarter results but providing disappointing guidance.

Significant weakness also emerged among transportation stocks, as reflected by the 1.4 percent loss posted by the Dow Jones Transportation Average. Union Pacific (UNP) and Con-Way (CNW) turned in two of the sector's worst performances.

Electronic storage, steel, and semiconductor stocks also posted notable losses, although selling pressure was somewhat subdued.

Meanwhile, some biotech stocks posted strong gains, with Human Genome Sciences (HGSI) surging up by 97.6 percent on news that the company rejected a takeover bid from GlaxoSmithKline (GSK) valuing the company at $2.6 billion.

Considerable strength among airline and health insurance stocks also helped to limit the downside for the broader markets.

The major averages climbed off their worst levels going into the close but remained firmly negative. The Dow dropped 68.65 points or 0.5 percent to 12,964.10, the Nasdaq fell 23.89 points or 0.8 percent to 3,007.56 and the S&P 500 slid 8.22 points or 0.6 percent to 1,376.92.

by RTTNews Staff Writer

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