Stocks ended the session mixed on Monday after investors’ anxiety about inflation was raised by a stronger-than-expected report showing the U.S. manufacturing sector is expanding but facing sharply higher costs for raw materials.
The Dow Jones industrial average fell 33.22, or 0.3 percent, to 10,535.48. The Standard & Poor’s 500 Index was down 2.11, or 0.2 percent, at 1,226.70. The Nasdaq Composite Index gained 3.74, or 0.2 percent, to 2,155.43.
U.S. factories reported large increases in new orders in September despite a rise in the price of materials amid record-high energy costs, the Institute for Supply Management said. Its index of national factory activity jumped to 59.4 in September from 53.6 in August, beating analysts’ median forecast for a drop to 52.
The manufacturing report as well as remarks by Atlanta Federal Reserve President Jack Guynn raised speculation that the Fed may boost interest rates again when it meets in November. The speculation hurt shares of companies sensitive to higher lending rates, such as Countrywide Financial Corp. Countrywide sank 2.4 percent to $32.20.
Among other local companies, shares of DaVita Inc. gained 4.6 percent after the El Segundo-based company said it expects to receive final regulatory approval from the Federal Trade Commission shortly for its acquisition of the U.S. health-care unit of Sweden’s Gambro AB. DaVita, which expects the acquisition to close in early October, agreed to buy Gambro’s U.S. clinics in December for $3.1 billion in cash.
Nara Bancorp Inc. rose 4 percent to $15.54 after the holding company of Nara Bank, N.A. confirmed its full-year profit outlook late Friday. The company said it expects to earn between $1 and $1.04 per diluted share, beating analysts’ estimates of 97 cents a share. On Monday, Nara’s stock rating was raised to “outperform” from “neutral” by analyst Lana Chan at Harris Nesbitt. The price target was set at $18 per share.
And shares of Health Net Inc. edged up 2.7 percent to $45.58 after the Woodland Hills-based managed health care company’s stock was upgraded to “neutral weight” from “underweight” by analyst David H. Shove at Prudential Equity Group Inc.
