The stock market today went into a mid-day swoon for the second day in a row, leaving market watchers scratching their heads to explain why.
Minor changes in the Bush administration's official economic forecast were blamed by some analysts, others cited anxiety about Federal Reserve Chairman Alan Greenspan's congressional testimony tomorrow.
It could also be the altitude. Stocks soared during May -- especially the Nasdaq Stock Market composite index, which climbed from 1900 to 2100 in just four weeks.
Neither earnings nor economic statistics entirely explained the gains, which took on a life of their own that raised the anxieties of students of market fundamentals.
If there weren't obvious reasons for the gains, there may not be obvious reasons for the retreats during the past two days. But the declines may simply reflect the reluctance of investors to keep bidding up stocks when the economic picture is unclear.
Today the Dow Jones industrial average climbed 60 points in the morning then fell to a six-point loss, closing at 10,476.86. Following similar trajectories, the Nasdaq composite closed off seven points at 2,060.18 and the Standard & Poor's 500 stock index fell almost three points to 1,194.67.
Stocks changed directions right after the White House updated its economic forecast for the year. The changes were considered so minor that economists pretty much ignored them, but the timing of the market retreat suggested they may have an influence on the market.
The latest official outlook is for the economy to grow by 3.4 percent this year down from 3.5 percent previously, for unemployment to fall to 5.2 percent from the previously forecast 5.3 percent and for inflation to run at a 2.9 percent annual rate rather than the 2 percent predicted before.
The higher inflation forecasts played into Wall Street's worries about the Fed and interest rates.
Wall Street seems to have assigned unusual significance to Greenspan's congressional testimony tomorrow, speculating that he will give some hints about how much higher short-term interest rates will be raised. Predicting what Greenspan will say rarely pays off on Wall Street, but that doesn't stop traders from trying.