Wall Street Rally Takes a Break

Stocks on Wall Street opened lower on Tuesday as investors paused after a seven-session string of gains and after a warning from the Bundesbank’s chief that the euro zone crisis has not ended.

The Standard Poor’s 500-stock index fell 0.1 percent in morning trading, the Dow Jones industrial average was flat and the Nasdaq composite index fell 0.1 percent. European markets were generally higher.

Both the Dow and benchmark S.P. 500 index have rallied, with the Dow closing at another record high on Monday and the S.P. within 10 points of its closing high of 1,565.15 points, set on Oct. 9, 2007.

Any pullback may be short-lived, however, as investors have been using recent dips as a buying opportunity.

Sounding a note of caution in Europe, Jens Weidmann, the head of the Bundesbank, Germany’s central bank, said the euro zone’s “crisis is not over despite the recent calm on financial markets.” Mr. Weidmann, who is also a member of the European Central Bank’s governing council, said that the region’s economic stability remains on shaky ground.

Still, investors’ confidence has grown on Wall Street, leading to a gain of more than 9 percent by the S.P. Signs of improvement in the economy and the Federal Reserve’s quantitative easing have helped to drive the gains.

“The data has been improving. No horror stories out of Europe at the moment, and China is on the mend,” said Frank Lesh, a futures analyst and broker at FuturePath Trading L.L.C. in Chicago.

Yum Brands, the parent company of the KFC restaurant chain, advanced 3.4 percent in early trading after reporting an unexpected rise in February sales in China.

Article source: http://www.nytimes.com/2013/03/13/business/daily-stock-market-activity.html?partner=rss&emc=rss