A disappointing earnings forecast from Texas Instruments Inc. and rising oil prices pushed stocks lower Tuesday as investors began consolidating gains from Wall Street's recent rally.
The Dow Jones Industrial Average fell 24.4 points, or 0.2 percent, to close at 10,912.62. The Standard & Poor's 500 Index was down 5.88, or 0.5 percent, to end the day at 1,219.43. The Nasdaq Composite Index lost 16.66, or 0.8 percent, to finish at 2,073.55.
Anticipation of Texas Instruments' mid-quarter update fueled buying on Monday, but the electronics manufacturer disappointed Wall Street by trimming the top end of its profit and revenue forecasts for the current quarter. Shares of Texas Instruments fell 3.8 percent to settle at $26.34.
Crude oil futures rose above $55 for the first time in more than four months before slipping lower at the end of trading. A barrel of light crude settled at $54.59, up 70 cents, on the New York Mercantile Exchange.
Among local movers, shares of Tag-It Pacific Inc. jumped 5.3 percent to close at $4.80 after the L.A.-based apparel company announced that its Talon zipper division signed a three-year franchise agreement covering the Middle East and surrounding regions, with a $20 million minimum purchase guarantee. Production and orders are expected to start in the third quarter.
On the down side, Korn/Ferry International Inc. fell 1.6 percent to $19.94 after the L.A.-based executive search firm released quarterly results. The company reported third-quarter net income of $9.8 million (23 cents per diluted share), compared with $3.9 million (10 cents) for the like period a year earlier. For fourth quarter ending April 30, 2005, the company expects earnings per share in the range of 22 cents to 25 cents, at the low end of analysts' consensus of 25 cents and a range of 23 cents to 28 cents.
Anworth Mortgage Asset Corp. lost 2.19 percent to $9.84 after the Santa Monica-based investment firm's stock was rated "market perform" in new coverage initiated by Stifel Nicolaus.
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