Stocks slid Wednesday after a lower 2005 gross domestic product forecast from the Bush administration dampened investors' enthusiasm over positive corporate news and lower oil prices.
The Dow Jones Industrial Average settled down at 6.21, or 0.1 percent, to 10,476.86, after spending most of the day in positive range. The Standard & Poor's 500 Index was down 2.59, or 0.2 percent, to 1,194.67. The Nasdaq Composite Index fell 6.98, or 0.3 percent, to 2,060.18.
The White House said it expects the economy to continue growing at a 3.4 percent rate, just below the 3.5 percent pace predicted in December. And rising energy prices prompted the administration to increase its inflation forecast for the year. The news made many on Wall Street even more skittish ahead of Thursday's Congressional testimony by Federal Reserve Chairman Alan Greenspan.
In company news, General Motors rose 4.2 percent to $32.02, after billionaire investor Kirk Kerkorian's Tracinda Corp. boosted its stake in the automaker to 7.2 percent, purchasing 18.9 million shares as part of a tender offer made last month.
And oil prices fell for the third straight day on Wednesday, slipping below $53 a barrel after a rally that was sparked by a drop in supplies fizzled and brokers locked in profits from a recent run up in prices. July light sweet crude fell $1.22 to settle at $52.54 a barrel.
Among local movers, shares of Arrowhead Research Corp. jumped 14 percent to $2.44 after the Pasadena-based nanotechnology development company announced it anticipated a profit of $21 million if 10.4 million in outstanding warrants are exercised before they expire by June 15. The company would use the funds for research and general working capital.
And Korn/Ferry International Inc. gained 3.4 percent to $17.50 after the L.A.-based executive search company reported net income of $11.7 million (27 cents per diluted share) for the fourth quarter ended April 30, compared with $8.7 million (21 cents) for the like period a year earlier
On the down side, North American Scientific Inc. lost 14.1 percent to $2.50 after the Chatsworth-based radiation oncology products producer reported a net loss of $3.9 million (24 cents per diluted share) for the second quarter ended April 30, compared with a loss of $3.9 million (38 cents) for the like period a year earlier
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