Wal-Mart forecast hits Dow Jones

Wal-Mart pulled down the Dow Jones industrial average after analysts at JPMorgan lowered their outlook for the company.

The Standard&Poor’s 500 index and the Nasdaq closed slightly higher.

JPMorgan’s analysts said the world’s largest retailer risks losing trade as low-income shoppers head to discount stores and other customers return to more expensive stores. Wal-Mart dropped 1.6% and was the weakest company among the 30 that make up the Dow Jones industrial average.

Stocks traded in a tight range throughout the day as investors weighed the impact of President Barack Obama’s 3.73 trillion dollar budget proposal for the next fiscal year.

Mr Obama’s budget includes a five-year freeze on many domestic spending programmes. The White House contends the budget plan for the fiscal year beginning on October 1 puts the government on course to cut deficits by about 1.1 trillion dollars over the coming decade.

Republicans and Democrats have sparred over how much spending to cut. The worry is that slashing spending could risk the economic recovery.

Bond prices held steady after details of the budget proposal were revealed. The yield on the benchmark 10-year Treasury note edged down to 3.62%, slightly lower than late on Friday. A jump in Treasury bond yields would suggest that investors see US debt as increasingly risky.

MGM Resorts International fell 3% after reporting a loss of 139 million dollars last quarter, a little narrower than analysts had expected.

The Dow fell 5.07 points, or less than 0.1%, to 12,268.19. The Standard&Poor’s 500 index rose 3.17 points, or 0.2%, to 1,332.32. The Nasdaq composite gained 7.74 points, or 0.3%, to 2,817.18.

Stocks ended last week with a slight gain after the resignation of Egyptian president Hosni Mubarak. That helped push both the Dow and S&P 500 to their highest levels since June 2008.