Wall Street ends flat to lower as FedEx outlook drags

NEW YORK (Reuters) - Stocks ended flat to slightly lower on Tuesday after bellwether FedEx cut its profit forecast and investors pulled back after last week's rally on central bank stimulus.

Falling oil prices weighed on the market for a second day, with the S&P 500 energy index <.gspe>, down 0.7 percent, the day's biggest decliner among the S&P's sectors.

The Standard & Poor's 500 remains up 5.3 percent since the end of July. The benchmark index reached levels not seen in nearly five years last Friday, a day after the Federal Reserve's unveiling of its plan to undertake a third round of stimulus. The Fed's announcement followed the European Central Bank's statement that it would buy bonds to support struggling euro- zone economies.

"We've gotten to the point where price momentum was such the market averages were overextended at the end of last week," said Fred Dickson, chief market strategist at D.A. Davidson & Co in Lake Oswego, Oregon. "Now we have this quiet period."

Shares of FedEx Corp fell 3.1 percent to $86.55. The Dow Jones transportation average <.djt> lost 1.1 percent. FedEx cut its profit forecast for its fiscal year 2013, saying that a weakening world economy had prompted customers to shift toward lower-priced shipping.

Estimates for the third-quarter S&P 500 companies' profits have fallen sharply in recent months, and earnings now are expected to decline 2.2 percent from a year ago, according to Thomson Reuters data. It would be the first such decline in three years.

Apple Inc , which broke sales records with its new smartphone, provided some support to the market. Apple's stock set another all-time high at $702.33 before ending at $701.91, up 0.3 percent.

The Dow Jones industrial average <.dji> gained 11.54 points, or 0.09 percent, to end at 13,564.64. The Standard & Poor's 500 Index <.spx> dipped 1.87 points, or 0.13 percent, to finish at 1,459.32. The Nasdaq Composite Index <.ixic> edged down 0.87 of a point, or 0.03 percent, to end at 3,177.80.

Weighing on the tech sector were shares of Advanced Micro Devices Inc , which tumbled 9.7 percent to $3.62 a day after the company said its chief financial officer was leaving the struggling personal computer chipmaker. The PHLX semiconductor index <.sox> lost 0.4 percent.

Economic data, however, offered a fresh sign of momentum for the housing market. U.S. homebuilder sentiment rose for the fifth month in a row in September to its highest level in over six years, the National Association of Home Builders said.

The PHLX housing sector index <.hgx>, however, was down 0.8 percent.

Aside from more economic reports on housing this week, investors will get readings on manufacturing. The Philadelphia Federal Reserve's survey of activity in the mid-Atlantic region, as well as the Markit manufacturing purchasing manager's index for September, are due on Thursday.

Data on Monday showed factory activity in New York state fell to its lowest level in nearly 3-1/2 years.

Volume was lower than average for a second straight day, with roughly 5.9 billion shares traded on the New York Stock Exchange, the Nasdaq and the Amex, compared with the year-to-date average daily closing volume of 6.5 billion. Many participants were out Monday and Tuesday for the observance of Rosh Hashana, the Jewish New Year.

Decliners outnumbered advancers on the NYSE by about 17 to 13, while on the Nasdaq, about 13 stocks fell for every 12 that rose.

(Editing by Kenneth Barry, Dan Grebler and Jan Paschal)

Source: http://news.yahoo.com/stock-index-futures-signal-early-dip-094330619--finance.html

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