Dow drops after Bernanke offers no stimulus

NEW YORK - Stock indexes closed lower Tuesday, giving up earlier gains, after Federal Reserve Chairman Ben S. Bernanke said the economic recovery remained uneven. Bernanke offered no new steps to stimulate growth.

The Dow Jones industrial average had been up as much as 89 points but turned lower in the late afternoon as Bernanke's speech started. The Dow's 19.15-point loss was the fifth straight decline for the index, the longest string of losses since August.

Some investors had been hoping Bernanke would announce additional measures to support the economy. Major indexes fell after it became clear that Bernanke was not wavering from his view that the U.S. economy was growing gradually and did not need more stimulus. The Fed's $600 billion bond-buying program, which is aimed at keeping interest rates low, is ending at the end of June.

"People are getting skittish," said Brian Wenzinger, a portfolio manager at Aronson Johnson Ortiz in Philadelphia. "Housing is getting worse, and they're rethinking a possible double-dip recession." But, Wenzinger added, the relatively small drop in the stock market was a positive sign after several days of steep losses.

The Dow fell 0.16 percent, to close at 12,070.81. The Standard & Poor's 500 dipped 1.23, or 0.10 percent, to 1,284.94. The Nasdaq composite shed 1 point, or 0.04 percent, to 2,701.56.

Stocks have swooned since late April because of concerns that the U.S. economy is stalling from a combination of high gas prices, weaker-than-expected hiring, and a slowdown in manufacturing. The Dow has fallen nearly 500 points over the last five days. The S&P remained below 1,300 for the second straight day and closed at its lowest level in 21/2 months.

The Labor Department reported that businesses had fewer job openings in April. The government said that employers posted three million ads for jobs in April, down from 3.1 million in March. The figure added to the stack of other signs that the United States is having an employment crisis. However, the report did little to change the direction of stocks.

In corporate news, a contentious acquisition proposal ratcheted up the stock price of all companies involved. International Paper Co. rose 0.4 percent after smaller rival Temple-Inland Inc. fought back against International Paper's hostile takeover bid for $3.3 billion in cash. Temple-Inland soared 40 percent on the news. Weyerhaeuser Co. rose 5 percent, the most of any company in the S&P 500, on suspicion it was another takeover candidate for International Paper.

Cablevision Systems Corp. rose 4.5 percent after the New York-area cable company set a date when it would spin off its cable networks. The company plans to divest popular television networks including AMC, which televises Mad Men, on June 16. Investors prefer the sleeker networks such as WE TV, IFC, and the Sundance Channel operating on their own to the current unwieldy corporate structure.