January 15, 2006	Sunday	Zilhaj 14, 1426

NEW YORK, Jan 14: US stocks stalled in morning trade Friday as investors remained cautious about upcoming corporate earnings and geopolitical events, despite generally upbeat economic reports.

The main indexes were nearly flat after minor swings in both directions.

At 1605 GMT, the Dow Jones Industrial Average was down 1.22 points (0.01 per cent) at 10,961.14, while the Nasdaq composite shed 1.85 points (0.08 per cent) to 2,314.84.

The broad-market Standard and Poor’s 500 index edged up a fractional 0.04 point to 1,286.10.

On Thursday, stocks posted their first significant decline of the year to date, due to worries about the resumption of Iran’s nuclear research programme. Concerns that fourth-quarter earnings will prove disappointing also weighed on the markets.

The economic reports Friday were generally encouraging.

The Labour Department reported wholesale prices jumped 0.9 per cent in December, marking the biggest gain since September. However, excluding food and energy costs, the core rate — seen as a better indicator — rose a modest 0.1 per cent.

A separate report showed US retail sales rose 0.7 per cent in December as outlays on vehicles and gasoline strengthened, the Commerce Department said Friday.

Excluding a 2.6 per cent gain in auto sales, seasonally adjusted retail sales rose 0.2 per cent last month.

Today’s retail sales report suggests that consumption in the fourth quarter will show some improvement, said economist Jack Homareau at RBC Financial Group.

Meanwhile, the core PPI figure suggests pressures on inflation are softening but corporate pricing power remains elevated as firms attempt to pass on higher costs stemming from rising unit labour costs.

But analysts said the market lacked momentum because of the strong gains in the past two weeks that have pushed up prices to high levels. Additionally, action was muted ahead of the Martin Luther King holiday weekend.

The market often has difficulty posting significant gains during the early weeks of earnings season. That could certainly happen again this quarter, said Dick Green at Briefing.com.

Earning season picks up strongly on Tuesday, after the Monday holiday, and will continue for four weeks. The market outlook is not bad. The fundamentals remain positive. We just don’t expect much momentum to develop near-term.

Among active shares, IBM dipped 88 cents to 82.69 after the company said the government’s informal probe into IBM’s disclosures of its expensing of equity compensation is now a formal investigation.—AFP