NEW YORK — Wall Street staggered through another volatile session Wednesday, closing mostly lower after a Federal Reserve report showed some economic growth at the end of 2007 and after Intel Corp.’s disappointing profit report.
Stocks gave up a modest rally in the final 20 minutes of trading, continuing the fluctuations seen throughout the session as investors pored over corporate profit reports and economic news that supported varying views about the soundness of the economy.
Stocks initially gained after the Fed report — its Beige Book survey of regional economies — suggested economic activity increased modestly from mid-November through December, though at a slower pace than in a previous survey.
The report seemed to quell some concerns about prospects for the economy that took on fresh urgency after Intel issued disappointing earnings after the closing bell Tuesday.
The Fed’s report bolstered enthusiasm among bullish investors who pointed to better-than-expected results from JPMorgan Chase & Co. and Wells Fargo & Co. The banks’ reports appeared to remind Wall Street that while the fallout of souring loans is widespread, it isn’t necessarily evenly felt. Buyout news in the tech sector also gave a boost to sentiment.
“I think the market is trying to find some kind of a correction point,” said Subodh Kumar, global investment strategist at Subodh Kumar & Assoc. in Toronto. “The talk on Wall Street has been about recession. Maybe the Beige Book has underscored that the U.S. is in a slowdown, but that it doesn’t look like a precipitous one.”
The Dow Jones industrial average fell 34.95, or 0.28 percent, to 12,466.16. Broader stock indicators also declined. The Standard & Poor’s 500 index fell 7.75, or 0.56 percent, to 1,373.20, and the Nasdaq composite index finished down 23.00, or 0.95 percent, at 2,394.59.
Investors remained edgy Wednesday, particularly after a drop Tuesday that took the Dow down nearly 280 points. Predictions by some economists that a recession is at hand have rattled Wall Street in recent weeks.
Intel was by far the biggest decliner among the 30 stocks that make up the Dow and also weighed on the tech-dominated Nasdaq. The chip maker fell $2.81, or 12.4 percent, to $19.88.
“Volatility will probably remain high into midyear because analyst expectations are coming down quite rapidly and we’re in the eye of the storm as far as credit write-downs go for banks,” Kumar said.
