New York: Better-than-expected US retail sales in March were unable to sustain an early rally on Wall Street as stocks struggled to come off their worst two-week period in more than four months, with much higher Spanish bond yields continuing to undermine confidence.
The Nasdaq fell sharply, weighed down by a near 3 per cent drop in Apple Inc. A fall in sales at Mattel Inc and a decline in Google Inc shares ahead of a high stakes legal battle with Oracle also hurt the Nasdaq.
Spanish 10-year government bond yields broke through the 6 per cent mark yesterday for the first time since the beginning of Dec-ember. Spain has acknowledged that it has probably tipped into its second recession since 2009.
"Europe is back. All this talk about Spain is unsettling for the market," said Frank Lesh, a futures analyst and broker at FuturePath Trading LLC in Chicago.
Stocks initially bounced sharply at the open after US retail sales rose more than expected in March, indicating economic growth in the first quarter did not soften as much as many had feared.
Gains for International Business Machines Corp and Caterpillar helped shield the Dow, as the high-priced stocks provided an outsized boost for the price-weighted index. IBM gained 0.6 per cent to $203.97 (Dh748.97), and Caterpillar rose 1.3 per cent to $107.26.
The Dow Jones industrial average was up 57.82 points at 12,907.41. The Standard & Poor's 500 Index was up 0.56 points, or 0.04 per cent, at 1,370.82. The Nasdaq Composite Index was down 23.28 points at 2,988.05.
Before yesterday's open the S&P 500 index had dropped 2.7 per cent over the prior two weeks, its worst two-week slide since November, on increasing concerns about the Euro-zone debt crisis and weaker-than-expected US economic data.
Citigroup advanced 2.5 per cent to $34.21 after posting a first-quarter profit that topped Wall Street expectations. The KBW Bank index climbed 0.6 per cent.
The economic picture was not entirely upbeat as the New York Federal Reserve said the pace of manufacturing growth in New York state slowed sharply in April to its lowest level in five months.
