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Wednesday, Feb 8, 2023

Stocks Mixed on Rising Oil Prices

Stocks finished the day mixed Tuesday as higher oil prices weighed on the Dow, but the Nasdaq’s rally stretched to a fourth day and the Standard & Poor’s 500 Index neared a four-year high in a sign of Wall Street’s underlying bullishness.

The Dow Jones Industrial Average edged down 5.83 points, or 0.1 percent, to close at 10,513.89, marking the end of a three-day rally. The Nasdaq Composite Index rose 7.72 points, or 0.4 percent, to 2,143.15, its highest close since Jan. 3. The Standard & Poor’s 500 Index advanced 2.77 points, or 0.2 percent, to finish at 1,222.21.

Oil prices rose above $60 per barrel as traders worried about another active hurricane season in the Gulf of Mexico. A barrel of light crude settled at $60.62, up $1.70, on the New York Mercantile Exchange.

Among local companies, shares of WPT Enterprises Inc. fell 5.3 percent to $21.98 a day after the L.A.-based owner of the World Poker Tour television show said it was unable to substantiate the credibility of a $700 million cash bid for the company made by professional poker player Doyle Brunson. The offer expires Tuesday evening.

American States Water Co. dropped 3.5 percent to $30.30 after the San Dimas-based water production and distribution company was rated “neutral 1” in new coverage by analyst Ajay Jain at UBS. The 12-month price target was set at $35 per share.

KB Home lost 1.4 percent to $80.15 after the L.A.-based homebuilder said Tuesday afternoon that it had reached a $2 million settlement with the U.S. Federal Trade Commission on mandatory arbitration clauses included in the warranties of home-purchase agreements. The Wall Street Journal reported Tuesday morning that the FTC planned to accuse KB Home of limiting buyers’ ability to sue the company over alleged defects.

And DreamWorks Animation SKG Inc. slipped 0.2 percent to $23.22 after the Glendale-based digital animation company’s stock was both downgraded twice and upgraded twice on Tuesday, a day after it warned that lackluster DVD sales would hurt its earnings this year. DreamWorks was cut to “neutral weight” from “overweight” by analyst Katherine Styponias at Prudential Equity Group Inc. and to “underweight” from “neutral” by Spencer Wang at JPMorgan. The company was also raised to “buy” from “neutral” by Michael L. Savner at Banc of America and to “peerperform” from “underperform” by analyst Raymond Lee Katz at Bear Stearns & Co.

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