* Microsoft raises quarterly dividend, stock falls
* Adobe tumbles after outlook, cut analyst ratings
* Gold prices jump to record high, 30-yr Treasuries rise
* Dow dips 0.2 pct, S&P slips 0.5 pct, Nasdaq off 0.6 pct
* For up-to-the-minute market news see []
(Updates to close)
By Ryan Vlastelica
NEW YORK, Sept 22 (Reuters) - U.S. stocks slipped on
Wednesday, ending the Dow's five-day winning streak, following
Adobe's discouraging revenue outlook and investors'
disappointment over Microsoft's new dividend.
Investors also weighed the impact of the Federal Reserve's
statement on Tuesday, which indicated the central bank was
edging closer to pumping hundreds of billions of new dollars to
stimulate the sluggish economy.
Adobe Systems Inc <ADBE.O> slid 19 percent to $26.67 and
was the biggest drag on the S&P 500 and Nasdaq a day after it
forecast lower-than-expected revenue, citing weak demand.
Analysts slashed their ratings on the software maker. For
details, see []
Microsoft Corp <MSFT.O> was the Dow's top decliner, falling
2.2 percent at $24.61. The company raised its quarterly
dividend and is set to pay out about $5.5 billion in annual
dividends to shareholders, but the move fell short of some
investors' expectations. []
"They wanted either a higher payout or a more concrete use
for the cash," said Andy Fitzpatrick, director of investments
at Hinsdale Associates in Hinsdale, Illinois. "This is a matter
of using the cash they have to their advantage and they don't
have any measure in place to execute that."
The Fed's cautious statement in the previous session, which
hinted that the U.S. central bank may embark on a new round of
monetary stimulus, unsettled some investors who had become more
optimistic about the economy as stocks rallied to a four-month
high.
"The Fed's comments were a double-edged sword. On one hand,
they're concerned about the economy, but on the other hand they
might do something stimulative. Stocks could go either way,"
said Thomas Villalta, portfolio manager for Jones Villalta
Asset Management in Austin, Texas.
The Dow Jones industrial average <> dipped 21.72
points, or 0.20 percent, to 10,739.31. The Standard & Poor's
500 Index <.SPX> slipped 5.50 points, or 0.48 percent, to
1,134.28. The Nasdaq Composite Index <> lost 14.80 points,
or 0.63 percent, to 2,334.55.
The Dow's loss was limited by Alcoa Inc <AA.N>, which
surged 4.8 percent to $11.70 a day after a steep sell-off.
The S&P 500 has rallied almost 9 percent in the last three
weeks, hitting a four month-high on Monday and breaching a
strong technical resistance level as improved economic data
suggested the economy might not slide back into recession as
some had feared.
U.S. gold futures hit a record near $1,300 per ounce and
the price of the 30-year U.S. Treasury bond ended up almost a
full point as its yield slid to a three-week low on hopes the
Fed may increase its purchases of Treasuries as part of a
second round of quantitative easing. The Arca Gold Bugs index
<.HUI> rose 1 percent.
"The most notable market action today is in bonds and gold,
and that shows the market taking into account the Fed's
unexpected view that it might need to take action to stimulate
the economy," said Nicholas Colas, chief market strategist at
the New York-based ConvergEx Group.
In other downbeat corporate news, chipmaker PMC-Sierra Inc
<PMCS.O> cut its third-quarter revenue outlook and forecast
gross margins at the lower end of its expectations, driving its
stock down 6 percent to $7.32.
Online retail site operator eBay Inc <EBAY.O> fell 1.6
percent to $24.34 after it eliminated the likelihood that its
third-quarter profit would beat analysts' expectations.
On the upside, both General Mills Inc <GIS.N> and CarMax
Inc <KMX.N> reported quarterly profits that beat expectations.
General Mills rose 2.7 percent to $36.63 while CarMax
advanced 8.5 percent to $26.16. [] and
[]
(Reporting by Ryan Vlastelica; Editing by Jan Paschal)
