Investors Shrug Off Poor Auto Sales

Stocks fell only slightly yesterday despite reports from automakers that their sales took another tumble last month.

The Dow Jones industrial average fell 0.91 percent, or 81.80 points, to 8952.89, while the Standard & Poor's 500-stock index was down 0.47 percent, or 4.35, to 927.45. The Nasdaq composite index lost 0.26 percent, or 4.18, to 1628.03.

The declines followed three days of gains on Wall Street, signaling that investors remain nervous about the state of the economy as they await progress on President-elect Barack Obama's economic stimulus plan, analysts said.

Apple bucked the downward trend yesterday, rising 4.2 percent, to $94.58 a share, after Steve Jobs, its chief executive, said that a treatable hormonal imbalance had caused his recent weight loss. There have been rumors about Jobs's health for months, and they intensified after he announced that he would not give the keynote speech at this year's Macworld event.

Jack A. Ablin, chief investment officer at Harris Private Bank in Chicago, said he expects companies to struggle with falling profits this year as employment declines and consumer spending shrinks.

But demand for government bonds, which spiked in recent months as investors sought safety from market turbulence, has eased slightly, indicating that some investors have regained confidence in the market. "We're mildly optimistic for stocks, but still think it's a washout year for earnings," Ablin said.

The bad news from automakers was expected, analysts said. Ford's shares were up almost 5 percent, to $2.58, after it reported that sales fell 32 percent in December and 20 percent for the year. General Motors' sales fell 31 percent in December and 23 percent in 2008 -- a 49-year low. Its stock was up 1.6 percent, to $3.71.

In economic news, construction spending fell 0.6 percent in November compared with the previous month, a smaller drop than analysts expected. Residential construction took the biggest hit, falling 4.2 percent in November, while the commercial sector managed a 0.7 percent increase, according to Commerce Department data.

The telecommunications sector slumped yesterday after Sanford C. Bernstein & Co. cut its outlook for AT&T and Verizon on an expected slowdown in subscriber growth.

AT&T fell 3.4 percent, to $28.43, while Verizon was down 6.2 percent to $32.48, giving it the biggest loss on the Dow. Crude oil was up 5.3 percent, to $48.81 a barrel, on the New York Mercantile Exchange. Prices have risen recently on concerns that Israel's conflict in Gaza could cause an oil disruption in the Middle East.