Nov. 11 (Bloomberg) -- U.S. stocks declined amid concern the pace of economic and corporate profit growth will slow, ending an eight-month rally that has lifted the Standard & Poor's 500 Index by 31 percent.
PeopleSoft Inc.'s shares fell after the Wall Street Journal reported that Oracle Corp. may end its unsolicited $7.3 billion bid for the business-software company. EchoStar Communications Corp. dropped as the satellite-television company added fewer subscribers than analysts expected.
``We need another catalyst to take us to new highs,'' Brian Pears, head of equity trading at Victory Capital Management, said in a television interview with Bloomberg News. The firm manages $46 billion. ``The area around 1050 for the S&P 500 is considered fair value. The market will settle there.''
The S&P 500 lost 3.08, or 0.3 percent, to 1044.03 at 10:26 a.m. in New York, and is headed toward its fifth drop in six days. The Dow Jones Industrial Average declined 25.03, or 0.3 percent, to 9731.50. The Nasdaq Composite Index dropped 16.45, or 0.9 percent, to 1925.19.
The S&P 500 has closed within 10 points of 1050 for 10 consecutive days and is up 31 percent since touching its 2003 low eight months ago today. The benchmark's members are expected to lift profits this year by an average of 18.5 percent, according to a Thomson Financial analyst poll, with growth slowing to 12.3 percent in 2004.
Almost nine stocks fell for every four that rose on the New York Stock Exchange. Some 249 million shares changed hands on the Big Board, 9.8 percent below the same time a week ago.
PeopleSoft, Oracle
PeopleSoft lost 68 cents to $21.37. Oracle may end its bid for PeopleSoft if PeopleSoft offers refunds to customers who may become dissatisfied after a takeover, the Wall Street Journal said. Oracle shed 1 cent to $12.56.
The bid may be abandoned ``as it will no longer be economically viable'' under PeopleSoft's money-back offer, Oracle said in a court filing, according to the newspaper. PeopleSoft is offering refunds of as much as five times consumers' software licensing fees, the Journal said.
Calls to PeopleSoft spokesman Steve Swasey and Oracle's Jim Finn, Jennifer Glass and Deborah Lilienthal weren't returned after business hours. PeopleSoft is based in Pleasanton, California, and Oracle is based in Redwood City, California.
EchoStar Communications Corp. shed $2.61 to $34.19. The No. 2 U.S. satellite-television company gained 285,000 in the third quarter; analysts expected 300,000.
Vertex Plunges
Vertex Pharmaceuticals Inc. plunged $4.46 to $8.19. The drugmaker said it stopped a test with French pharmaceutical maker Aventis SA of a experimental rheumatoid arthritis medicine because animals that got the product experienced liver abnormalities. Vertex decided to end the trial after consulting with the U.S. Food and Drug Administration. Aventis fell 1.5 percent to 45.69 euros.
Concur Technologies Inc. shed $2.64 to $8.75. The company, which makes software used to manager corporate personnel records, said revenue for the first quarter ending in December will be $13 million to $14 million. Sales totaled $14.6 million a year earlier.
PacifiCare Health Systems Inc., which manages Medicare health-care plans, dropped $2.41 to $52.69. The company said it sold 3.8 million shares of common stock at $52.95 each. Proceeds will be used to pay debt.
Sony Corp.'s American depositary receipts fell 73 cents to $35.79. Microsoft Corp., the world's largest software maker, will reduce the price of its Xbox game console in Japan by as much as a third to compete with rivals including Sony.
Tenet Healthcare Corp. lost 11 cents to $13.14. The second- biggest U.S. hospital chain said its third-quarter net loss was 66 cents a share, compared with net income of 66 cents a year earlier. The company added today that it expects additional reorganization costs.
Energy Shares
Energy stocks rose after analysts recommended shares of Exxon Mobil Corp., the world's biggest oil company owned by investors. The S&P 500 Energy Index added 0.2 percent, the biggest advance among the benchmark's 10 industry groups.
Exxon Mobil added 32 cents to $36.08. Analysts' forecasts for Exxon's production growth are too low, Banc of America Securities analyst Tyler Dann said. He predicts Exxon's production will swell by 5 percent in 2004, above the company's forecast of 3 percent.
Arjun Murti, an analyst at Goldman, Sachs & Co., raised his rating on Exxon to ``outperform'' from ``in-line.''
Retailers Rise
Gap Inc., Zale Corp. and other U.S. retailers gained. Merrill Lynch & Co. analysts said the stocks will provide a better return than the U.S. market through at least March as the companies report surprisingly strong earnings.
Gap rose 19 cents to $20.92, Zale climbed $1.37 to $54.62, Saks Inc. rose 38 cents to $15.23, BJ's Wholesale Club Inc., rallied $1.04 to $26.94, Neiman-Marcus Group Inc. advanced $1.34 to $52.01, Abercrombie & Fitch Co. rose 67 cents to $28.53, Oakley Inc. jumped $1.65 to $12.57 and Tiffany & Co. rallied $2 to $49.20. Merrill raised its rating on the nine stocks ``buy'' from ``neutral.''
Marriott International Inc. added 91 cents to $46.22. The largest U.S. hotel company said it would earn $1.86 to $1.88 a share in 2003 and have compound per-share annual profit growth of as much as 22 percent, excluding certain costs, through 2006.
