"This market is becoming increasingly fragmented," said Michael Metz, investment strategist at Oppenheimer & Co. "Each day, it seems it's a new index or bunch of stocks that's leading the market in one direction or the other."
The Dow lost 7.83 points, to 3,664.66, led by a decline in shares of AlliedSignal Inc. and Minnesota Mining & Manufacturing Co., two stocks that had risen in recent sessions.
The Nasdaq composite gained for the first time this week. The index rose 6.42, to 771.88, led by a rally in leading computer-related companies like Apple Computer Inc.
Among broader market averages, the Standard & Poor's 500 Index gained 0.30, to 464.6, and the New York Stock Exchange Composite Index rose 0.19, to 257.46. The American Stock Exchange Market Value Index rose 1.42, to 475.06.
On the NYSE, advancing stocks exceeded declining issues by a small margin. Trading was active, with about 280 million shares changing hands.
"The stock market was stuck in a rut as investors wait for release of third-quarter GDP," said Peter Cardillo, research director at Westfalia Investments Inc. The government will release its report on gross domestic product growth today. Economists estimate that GDP expanded at an annual rate of 2.8 percent in the third quarter.
"Real GDP for the quarter should be up a solid 2.5 percent to 3 percent, led by consumer spending and residential investment," said John Silvia, chief economist for the Kemper Mutual Funds.
The Dow has risen 3.5 percent since Sept. 21 amid signs that the economy is strengthening. "The GDP better confirm these expectations, or the stock market could be in trouble," said William Raftery, a market analyst at Smith Barney Shearson Inc.
The Commerce Department reported yesterday that orders to U.S. factories for durable goods rose 0.7 percent in September, the third advance in four months. The gain occurred despite fewer orders for aircraft and defense hardware. Analysts had predicted that orders would rise 0.2 percent in September.
The report contributed to a rise in long-term interest rates.
"If rates rise much further, that would be a real problem for the stock market," said Joseph Battipaglia, chief investment strategist at Gruntal & Co.
The yield on the 30-year Treasury bond rose yesterday to 6 percent, up more than two-tenths of a percentage point from its record-low close of 5.79 percent, set Oct. 15.
Low interest rates have been a driving force behind this year's rally in the stock market. The low rates cause investors to move money out of low-yielding fixed-income securities and into stocks, which offer prospects for higher returns.
Companies continued to report earnings that exceeded analysts' expectations. More than half the companies to report third-quarter results have surpassed estimates, according to Institutional Brokers Estimate System Inc., a unit of Citicorp.
Ford Motor Co., Bethlehem Steel Corp., Hercules Inc., Singer Co. and Timberland Co. were among the companies to report higher-than-expected earnings yesterday.
Then there were companies like Eastman Kodak Co. The maker of photographic equipment, health-care products and chemicals recorded a third-quarter loss of $68 million, or 21 cents a share, including a restructuring charge of $387 million, or $1.18 a share.
Excluding the charges, Kodak earned 97 cents a share, down from $1.01 in the prior year. Analysts had expected Kodak to earn $1.06 a share before the charges. Despite the disappointing results, Kodak's stock rose a sharp $4.25, to $62.125.
And after the market closed, Kodak announced that George M.C. Fisher, the head of Motorola Corp., would become its new chairman and chief executive on Dec. 1.
Ford rose 62.5 cents, to $60.375. The automaker reported third-quarter earnings of 79 cents a share, the best result in five years. Ford reported a loss of 66 cents a share a year earlier.
Paramount Communications rose $2, to $81, as QVC Network Inc. began an $80-a-share offer for the company's stock. QVC is competing with Viacom Inc. for control of Paramount. Viacom began a tender offer of its own on Monday.