Wall St: Thursday mid-session

 

STOCKS edged higher, erasing earlier losses as investors nibbled at names like chip maker Intel and aluminum producer Alcoa in light trading.

'There's just quiet August activity going on with a lot of volatility in between,' said Jack Schwetje, senior equities trader at Deutsche Bank Securities.

Rising bond yields kept a lid on price gains. US Treasury prices fell for a fourth straight session, sending yields to one-year highs. Investors fear that rising bond yields could choke economic growth by raising borrowing costs.

A slew of economic data before the open landed in line with expectations, but offered little inspiration to the market during the slow summer season. August is expected to be a lacklustre month on Wall Street with trading volumes thinning out as many traders take holidays.

The blue-chip Dow Jones industrial Average added 23 points to 9294 by mid-sessin. The technology-laced Nasdaq gained 5 points to 1692.

Intel rose 25 cents to $24.96 and ranked as the most active share on the Nasdaq. Alcoa advanced 54 cents, or 2%, to $27.56. Conglomerate United Technologies also helped the Dow with a gain of $1.51, or 2%, to $76.20.

But McDonald's lost 61 cents, or 2.6%, to $22.56 and ranked as the largest percentage loser on the Dow. Wachovia Securities cut the fast-food company to 'market perform' from 'outperform,' saying the shares are 'near-fully valued'.

ATI Technologies rallied 87 cents, or 7%, to $13.12. The company has struck a deal with Microsoft to develop graphics technology for its next generation Xbox video game console, dealing a blow to rival Nvidia, down 62 cents, or 3.7%, to $16.16.

Target fell 85 cents, or 2.1%, to $39.09. The retailer reported a 4% increase in quarterly profit, helped by strength in its credit card division, but the earnings fell short of Wall Street expectations.