Weak consumer confidence, more corporate dealmaking keep stocks from making big moves

Stocks mixed after weak consumer confidence report

NEW YORK — Stocks wavered Tuesday following news that consumer confidence dropped to its lowest level since February.

Major indexes fell in early trading but recouped much of their losses my late morning as traders were encouraged by another flurry of corporate deals. The Dow Jones industrial average rose 5 points after being down 83 points earlier in the day. Broader indexes dipped.

The Conference Board said its September reading on consumer confidence fell sharply from August and was well below forecasts. Stocks have rallied throughout September as many major economic reports suggested that growth was slightly better than previously thought.

Scott Rostan, founder of Training the Street, which provides courses in financial modeling and corporate valuation, said the small move in stocks compared to the big decline in confidence was indicative of a growing schism between consumers and traders.

“There’s a big dichotomy between Main Street sentiment and Wall Street sentiment,” Rostan said. Right now, traders are more focused on sentiment and confidence among corporate executives than consumers, he said.

Drug developer Endo Pharmaceuticals Holdings said Tuesday it will buy Qualitest Pharmaceuticals for $1.2 billion. That comes a day after major companies like Unilever NV and Southwest Airlines Co. announced deals and Wal-Mart Stores Inc. said it was pursuing buying a South African company.

In other corporate news, technology stocks were being dragged down on disappointment that Research in Motion Ltd. said it would not roll out its competitor to Apple Inc.’s iPad, called the PlayBook, until the beginning of 2011. Walgreen Co. soared 9 percent after the drugstore chain reported income that easily beat forecasts.

The Dow rose 4.51, or less than 0.1 percent, to 10,816.93 late morning trading.

The Standard & Poor’s 500 index fell 1.29, or 0.1 percent, to 1,140.87, while the Nasdaq composite index fell 3.81, or 0.2 percent, to 2,365.96.

Treasury prices rose after the weak report on consumer confidence, driving interest rates lower. The yield on the 10-year Treasury note, which is often used to set interest rates on loans, fell to 2.49 percent from 2.53 percent late Monday.

Endo Pharmaceuticals shares rose $2.87, or 9.4 percent, to $33.48.

Research in Motion shares fell $1.85, or 3.8 percent, to $46.51. Apple shares fell $2.07 to $289.09.

Walgreen shares rose $2.83, or 9.3 percent, to $33.18.

Falling stocks slightly outpaced those that rose on the New York Stock Exchange where volume came to 267.3 million shares.

Overseas, Germany’s DAX index fell 0.2 percent, while France’s CAC-40 dropped 0.2 percent. Britain’s FTSE 100 fell 0.1 percent.