Disappointing Intel News Lead Wall Street to Close Down (Reuters) (17-01-2008)

NEW YORK (Reuters) - Stocks finally ended lower after a volatile session on Wednesday, affected by the disappointing profit and outlook by Intel Corp, which drove the S&P 500 to its lowest closing level in 14 months. These were followed by poor retail sales data on Tuesday, dismal banking results and a slew of indicators showing the U.S. economy may be on the brink of a recession.

Other technology shares also suffered, most notably Apple, after the maker of the iPod failed to inspire with new products at its Macworld convention.

The volatility, which sent the Dow rising and falling by as much as 100 points, was largely due to investors going after beaten-down bank stocks, after JPMorgan Chase & Co posted a profit despite turmoil in the credit market, in the wake of the gloom cast by Citigroup's record quarterly loss on Tuesday; a smaller-than-expected profit decline by Wells Fargo & Co, the No 2. U.S. mortgage lender also gave some support.

The Dow Jones industrial average .DJI was down 34.95 points, or 0.28 percent, at 12,466.16. The Standard & Poor's 500 Index .SPX was down 7.75 points, or 0.56 percent, at 1,373.20. The Nasdaq Composite Index was down 23.00 points, or 0.95 percent, at 2,394.59.

Lending some support during the session was news that a legislative package to stimulate the U.S. economy and avert a recession could be signed into law within a month.

That helped some hard-hit sectors like home builders and home-funding providers Fannie Mae and Freddie Mac. The Dow Jones home construction index rose 3.7 percent.

JPMorgan shares rose 5.8 percent to $41.43. Wells Fargo rose 3.3 percent to $27.37.

Shares of Intel dropped 12.4 percent to $19.88 on the NASDAQ. Other major tech shares trading sharply lower were Apple, down 5.6 percent to $159.64, and Blackberry maker Research in Motion Ltd, down 1.8 percent to $89.30.

Energy stocks dragged on the market after crude oil futures CLc1 fell to settle down 1.15 percent at $90.84. Shares of Devon Energy Corp fell 3.7 percent to $84.08, and oil field services company Schlumberger Ltd fell 3.4 percent to $85.90.

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