NEW YORK — Wall Street ended mixed Tuesday, selling off large companies’ stocks but buying up those of smaller companies as investors cashed in gains from Monday’s big rally and poked around for new bargains.
It was a somewhat unusual day of trading – normally, the major stock indexes closely track one another, but Tuesday, the Dow Jones industrials closed with a moderate loss while the Nasdaq composite index had a moderate gain. Given the market’s quick, sharp rebound from August’s credit-market squeeze and stock sell-off, it was to be expected that investors would pause to adjust their portfolios as the fourth quarter gets underway.
Wall Street was only slightly fazed by the National Association of Realtors’ report Tuesday that its seasonally adjusted index of pending sales for existing homes fell 6.5 percent in August from July and 21.5 percent from a year ago.
The data suggest sales of existing homes will probably keep declining in the coming months – bad news for the economy but good news for those hoping for another interest-rate cut.
After the Federal Reserve lowered rates Sept. 18, the stock market is hoping for a similar move again at the Fed’s Oct. 30-31 meeting.
“The economy is soft, you have this big run-up, and the fact is people are just taking some profit,” said Scott Fullman, director of investment strategy for I.A. Englander & Co. “There’s not a ton of news to trade on, and investors are also looking ahead to the unemployment report on Friday.”
The Dow fell 40.24, or 0.29 percent, to 14,047.31, as investors sold some of their large- cap stock holdings, which have recently performed well. The broader Standard & Poor’s 500 index fell 0.41, or 0.03 percent, to 1,546.63, while the tech-dominated Nasdaq rose 6.12, or 0.22 percent, to 2,747.11.
