Stocks fell Wednesday after Intel Corp. announced disappointing earnings and issued a lackluster forecast that raised concerns about demand for technology products, reported The Associated Press. Not all corporate news was downbeat, however. JPMorgan Chase & Co. and Wells Fargo & Co. offered some relief for investors concerned about the health of banks. And buyout news in the tech sector appeared to help keep stocks' losses in check. The market remains edgy, particularly after a plunge Tuesday that took the Dow Jones industrials down nearly 280 points. Investor patience has been tested by the predictions of some economists that a recession is at hand and by unsteadiness in the financial sector, where many banks are struggling to restore damaged balance sheets. Intel's failure to meet earnings and revenue forecasts for the fourth quarter and its first-quarter projections that came in at the low end of analysts' forecasts weighed on stocks. Earlier this week there was market speculation that the technology sector, which sometimes benefits from a weak dollar and overseas strength, might be able to withstand the weakness sweeping other parts of the economy. The tech arena saw some cheer Wednesday, thanks to Oracle Corp.'s deal to buy BEA Systems Inc. for about $7.85 billion. Last year BEA rejected a less expensive bid from Oracle, which raised its offer but not to the level sought by BEA. In midmorning trading, the Dow fell 47.96, or 0.38 percent, to 12,453.15. Broader stock indicators were narrowly mixed. The Standard & Poor's 500 index rose 7.07, or 0.51 percent, to 1,373.88, and the Nasdaq composite index fell 35.46, or 1.47 percent, to 2,383.13. Intel was by far the biggest decliner among the 30 stocks that make up the Dow industrials and also weighed on the tech-dominated Nasdaq. Intel fell $2.81, or 12.4 percent, to $19.88. Declining issues narrowly outpaced advancers on the New York Stock Exchange, where volume came to 356.5 million shares. Bond prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.70 percent from 3.68 percent late Tuesday. The dollar fell against other major currencies, while gold prices rose. Light, sweet crude fell $1.26 to $90.64 per barrel on the New York Mercantile Exchange. The Labor Department reported that consumer prices in December showed an increase of 0.3 percent for the headline figure and a 0.2 percent advance for the core rate, which strips out often-volatile food and energy prices. Both figures had been expected to rise by 0.2 percent, according to Thomson/IFR. The Federal Reserve, in setting monetary policy, is known to pay closer attention to the core rate. In any case, investors appear more worried about the prospect of slower growth than that of higher inflation. In addition, Fed Chairman Ben Bernanke already has sent strong signals that another rate cut is on the way this month. The Fed's next monetary policy meeting is Jan. 29-30, and some investors are calling for a rate cut before then. The Fed also said output at the nation's factories, mines and utilities showed no growth in December. Wall Street had expected industrial production to show a 0.2 percent decline in output, after a 0.3 percent November gain. JPMorgan offered a first-quarter earnings report that revealed relatively light exposure to the faltering subprime loans as it booked a write-down of $1.3 billion, which was smaller than the massive losses of peers like Citigroup Inc. Citi on Tuesday reported a quarterly profit that fell below analysts' expectations. But JPMorgan warned of difficult conditions ahead in 2008 and said profit was reduced by problems with home equity loans that underscore the mounting pressures in consumer lending. JPMorgan rose $1.80, or 4.6 percent, to $40.97, while Citi fell $1, or 3.7 percent, to $25.94. Wells Fargo revealed its first decline in profit in more than six years and also cited rising losses on home equity loans. But the company, one of the nation's largest banks, largely sidestepped the write-downs of bad debts that many other banks have been forced to make. Wells Fargo rose 67 cents, or 2.5 percent, to $27.16. BEA Systems Inc. jumped $2.96, or 19 percent, to $18.54 after word of its deal. Oracle slipped 2 cents to $21.29. But despite some upbeat news, Wall Street remained concerned about any signs the economy was slowing. California Pizza Kitchen Inc. fell $2.04, or 16.6 percent, to $10.23 after the gourmet pizza chain reduced its fourth quarter and fiscal 2008 forecasts, citing lower spending by diners. The Russell 2000 index of smaller companies fell 3.39 percent, to 0.49 percent, to 694.04.
