US stocks end mixed as September rally loses steam

NEW YORK – Stocks struggled to a mixed finish Thursday as a two-week rally lost momentum. News of a retrenchment by FedEx Corp. also discouraged buyers. Stocks have been rising for most of September, but on unusually weak volume as skepticism lingers about the economy. FedEx, an economic bellwether, darkened the mood with an announcement that it would eliminate 1,700 jobs in an effort to save its money-losing US trucking business. Traders were becoming wary as the Standard & Poor's S&P 500 index, the benchmark most used by professional investors, approached the high end of its recent trading range. Investors are often hesitant to push a major index outside of recently tested limits for fear that automated selling programs could kick in and send prices lower. Over the past few days the S&P has approached 1,131, a level it has not touched since June. Market analysts have long paid attention to technical trading levels such as these, but they are especially important now since electronic trading is so prevalent. According to preliminary calculations, the Dow Jones industrial average rose 22.10, or 0.2 percent, to close at 10,594.83. The Dow has now risen in 10 of the last 12 days, but it's still 5.5 percent below its 2010 closing high level reached on April 26. Broader indexes were mixed. The Standard & Poor's 500 index fell 0.4, or 0.04 percent, to 1,124.66. The index is still up 7.2 percent for September, which is usually a weak month for stocks. The Nasdaq composite edged up 1.93, or 0.08 percent, to 2,303.25. About three stocks fell for every two that rose on the New York Stock Exchange, where consolidated volume was low at 3.5 billion shares. Trading volume has been very low in recent weeks as many investors sit on the sidelines. That could leave the market vulnerable if sentiment suddenly worsens. The mixed day on Wall Street came despite some encouraging news on the economy. The Labor Department said first-time claims for unemployment benefits fell to a two-month low last week to 450,000. They're still well below levels that suggest economic growth. "Bottom line, everybody is worried the economy is in terrible shape," said Dennis Paul, a senior portfolio manager at the Rosenau/Paul Group at Hightower Advisors. "But it's not getting any worse." A separate report Thursday indicated prices at the wholesale level rose more than expected last month, easing concerns about deflation, an economic malaise defined by falling prices. Relief over the reading in the Producer Price Index sent Treasury prices slightly lower and their yields higher. The yield on the 10-year Treasury note, which moves opposite its price, rose to 2.76 percent from 2.72 percent late Wednesday. Its yield is used to help set interest rates on mortgages and other consumer loans. "I'm not sure the deflation theory is completely debunked, but it's pretty close," said Jamie Cox, a managing director at Harris Financial Group. FedEx shares dropped $3.22, or 3.8 percent, to $82.72. Competitor UPS Inc.'s shares also fell following the report from Fed. UPS dropped 94 cents to $66.72. — AP