U.S. broad stock market near unchanged, techs slip

Reuters, 12.30.02, 12:49 PM ET By Denise Duclaux

NEW YORK, Dec 30 (Reuters) - The broad market seesawed near unchanged in feather-light trading on Monday with nervous investors hugging the sidelines as global tensions simmer at the tail-end of a brutal year on Wall Street.

Technology stocks dropped, pressured by semiconductor makers like giant Intel Corp. (nasdaq: INTC - news - people) after a research group said growth in global chip sales slowed in November from October.

"Most people will be happy when this year is over," said Edgar Peters, chief investment officer at PanAgora Asset Management, which manages $13 billion. "Investors are confused."

This week starts with the last two trading sessions of 2002 before the stock market shuts on Wednesday -- New Year's Day. Wall Street is limping toward its first three-year losing streak since 1939-41, while the blue-chip Dow is headed to its worst December performance since 1931.

Fears of a U.S. war against Iraq are rippling across the globe. North Korea added to the world's concerns last week after saying it pressing on with plans to reactivate a mothballed nuclear research facility.

In another eruption of global unrest, a gunman shot dead an American doctor and two of her American colleagues in Yemen on Monday in what officials called an "Islamic extremist" attack.

"The geopolitical situation does not lend itself to create confidence to put money at risk," said Paul Cherney, a market analyst at S&P Marketscope. "At any time you could have a headline that forces short-term traders to become sellers."

The Dow Jones industrial average <.DJI> ticked up 15.78 points, or 0.19 percent, to 8,319. The broad Standard & Poor's 500 Index <.SPX> was up 0.77 points, or 0.09 percent, at 876. The technology-laced Nasdaq Composite Index <.IXIC> slumped 13.02 points, or 0.97 percent, to 1,335, on track for its fourth down session.

Declining stocks edged out advancers by a ratio of 8 to 7 on the New York Stock Exchange and 11 to 5 on Nasdaq. More than 496 million shares were traded on the Big Board and more than 549 million shares on Nasdaq in light volume.

"The news on the geopolitical front is decidedly negative," said Stanley Nabi, managing director at Credit Suisse Asset Management, which manages about $269 billion globally. "This is creating a huge amount of uncertainty among corporate managers. They can't focus on what they are going to spend and when they are going to spend it until this cloud lifts."

CHIP STOCKS SLUMP Chip stocks fell after research group World Semiconductor Trade Statistics said global chip sales slowed to 1.3 percent in November from October, well below average growth for the month. Chip sales growth could slow further if early indications are correct that consumers have become morecautious since a relatively buoyant Thanksgiving in late November.

The Philadelphia Stock Exchange's semiconductor index <.SOXX> slumped 2.55 percent. Intel fell 51 cents to $15.89. Semiconductor equipment maker Applied Materials (nasdaq: AMAT - news - people) lost 22 cents to $13.30. Chip supplied Advanced Micro Devices (nyse: AMAT - news - people) shed 8 cents to $6.27. Oil stocks eked out gains at midsession although oil prices fell after OPEC indicated its readiness to fill in supply gaps caused by a long strike in Venezuela. Prices had earlier hit a new two-year high as possibility for war in Iraq and the continued strike in Venezuela put oil-supply jitters on traders' front burner.

Exxon Mobil Corp. (nyse: XOM - news - people), the world's largest publicly traded oil company, advanced 29 cents to $34.93. ChevronTexaco (nyse: XOM - news - people) rose 66 cents to $66.56. Amerada Hess Corp. (nyse: XOM - news - people) rose 60 cents to $55.26. ConocoPhillips (nyse: XOM - news - people) added 29 cents to $48.11. The recent surge in prices bodes well for oil companies, but higher energy prices could cut profits for the rest of Corporate America.

Wal-Mart Stores Inc. (nyse: WMT - news - people), the world's biggest retailer, ticked up 83 cents to $49.99. The Dow component said it expects December sales at its U.S. Wal-Mart discount stores open at least a year to be up 3 percent, while its Sam's Club warehouse stores.

But Home Depot Inc. (nyse: HD - news - people), the world's largest home-improvement store and a Dow member, fell 37 cents to $23.40. This holiday season is forecast to be the weakest one on record for U.S. retailers.

International Business Machines Corp. (nyse: IBM - news - people) lost $1.27 to $76.09, dragging on the Dow. Bank J. P. Morgan Chase and Co. (nyse: IBM - news - people) said it signed a seven-year contract for information technology services with IBM in a deal worth more than $5 billion. J.P. Morgan, another Dow member, added 9 cents to $23.89. (With additional reporting by Doris Frankel)