Stocks end mixed; energy prices sag

NEW YORK — Stocks closed mixed Wednesday as sagging energy prices and a strong advance by Honeywell International sent the Dow Jones industrial average higher, but downgrades of Apple Computer dragged the tech-heavy Nasdaq composite lower.

The Dow rose 59.79 to 10,883.51, getting a lift from Honeywell, which rose by as much as 6.8 percent after it issued 2006 earnings guidance in line with Wall Street's expectations.

Boeing, one of the 30 Dow stocks, soared 86 cents to an all-time high of $71.45 a share after Microsoft, also a Dow stock, slipped 4 cents to $27.09 after Australia's flagship carrier Qantas said it could order as many as 115 new Boeing 787 Dreamliners in a deal that may net Boeing at least $14.4 billion.

Broader stock indicators were mixed. The Standard & Poor's 500 index rose 5.31 to 1,272.74, hitting a four-year high. The Nasdaq fell 2.41 to 2,262.59.

"Big stocks are finally capturing some attention," said Philip Dow, managing director of equity strategy at RBC Dain Rauscher in Minneapolis.

A recent upward revision in the nation's gross domestic product, along with a positive outlook from General Electric on Tuesday and Honeywell's guidance Wednesday are "all things that say America has not lost its fastball," Dow said.

Crude-oil futures, gasoline and natural-gas prices all settled lower following a surprisingly strong inventory report from the Department of Energy. A barrel of light crude settled at $60.85, down 52 cents, in trading on the New York Mercantile Exchange.

Just how great an effect energy prices could have was evidenced by the trade deficit, which rose to an all-time high in October as oil shipments soared and the United States set deficit records with China, Europe, Canada and Mexico. So far this year, the trade deficit is running at an annual rate of $718 billion, far surpassing last year's $617.6 billion imbalance.

Hopes that the Federal Reserve's streak of interest-rate increases will soon end helped the mood on Wall Street. Tuesday's Federal Open Markets Committee meeting "was a watershed in the sense that it was the first time the Fed left the window open for a pause in this 18-month-old tightening cycle," said David Rosenberg, Merrill Lynch's North American Economist, in a research note Wednesday.

While the Fed raised interest rates another quarter percentage point to 4.25 percent, the wording of the central bank's economic assessment statement was interpreted as a signal that the Fed would soon halt its rate increases.

In company news, both Banc of America and Bear Stearns downgraded Apple Computer, with Banc of America saying the 50 percent run-up in the stock's price over the past six weeks has made it hard to justify more buying. Apple, which makes computers and iPods, fell $2.97 to $72.01. Diversified manufacturer Honeywell jumped $1.62 to $37.50 after it gave 2006 earnings guidance of $2.35 to $2.50 a share, up 20 percent to 30 percent. The company also affirmed its earnings and sales targets for 2005.