NEW YORK - U.S. stocks fell on Thursday, led by a sell-off in technology shares as investors worried about the timing of Microsoft Corp.'s launch of its new operating system.
Blue chips ended just 2 points lower on the day. All three major indexes started the day higher, but lost ground following a decline in the shares of Microsoft, the world's largest software maker.
Even though a Microsoft executive at the company's analysts' meeting said he saw no reason to delay the previously announced shipping dates for the Vista software later this year and early in 2007, traders said investors had hoped the company would give a clearer timeline.
"There was a lot of speculation that Vista will be late, and they did not come out and definitely say that it is on time, either," said Greg Palmer, head of equity trading at Pacific Crest Securities.
Windows systems are used in more than 90 percent of the world's personal computers, and Microsoft's revenue typically rises with the release of a major Windows upgrade.
Also weighing on the broader market were shares of Aetna Inc., which slid almost 17 percent. Aetna, one of the biggest U.S. health insurers, said quarterly income fell on higher medical costs. It also cut its membership forecast.
The Dow Jones industrial average was down 2.08 points, or 0.02 percent, to finish at 11,100.43. The Standard & Poor's 500 Index was down 5.20 points, or 0.41 percent, to end at 1,263.20. The Nasdaq Composite Index was down 15.99 points, or 0.77 percent, to close at 2,054.47.
Aetna shares fell $6.71 to $33.25 on the New York Stock Exchange, making them the second-biggest drag on the S&P 500. Earlier, Aetna hit a fresh 52-week low at $31.03.
But the big influence on the market's mood and direction came after midday when Microsoft said it will release Windows Vista when it's ready. The company had already postponed the release of its much anticipated upgrade to Windows for consumers until early 2007, after the holiday shopping season, to improve the system's quality. Vista is set to ship to corporate clients this November.
Microsoft's stock fell 2.1 percent, or 50 cents to $23.87 on Nasdaq, after dropping to $23.77 earlier in the day.
"When are all these investments they are making actually going to pay off?" Palmer asked, adding, "The luster is off the stock."
The move to Microsoft Windows Vista is expected to drive businesses and consumers to upgrade the computers and other software they run on their machines and to enable a new wave of Internet and media services growth.
In other earnings news, Dow Chemical Co., the largest U.S. chemicals maker, reported earnings that missed analysts' estimates, as surging energy costs eroded profits for its plastics and chemicals businesses. Its shares fell 10 percent, or $3.74, to $33.54 on the NYSE.
Shares of Exxon, the world's largest public oil company, ended down slightly after shooting to an all-time high after it reported quarterly profit of more than $10 billion. Exxon shares slipped 0.1 percent, or 8 cents, to $66.47 on the NYSE. They rose as high as $67.65 earlier in the day.
The second-top positive influence on the S&P 500 was Comcast Corp. The biggest U.S. cable operator also beat Wall Street forecasts. The stock rose 4.6 percent, or $1.50, to $34.02 on the Nasdaq.
Also helping to keep the market in positive territory earlier in the day was a report by the Commerce Department showing new orders for U.S.-made durable goods rose 3.1 percent, more than expected, in June.
"That was a little bit encouraging," and relieved some worries about slower economic growth, said Victor Pugliese, managing director and head of New York equity trading at First Albany Corp.
Trading was heavy on the NYSE, with about 1.82 billion shares changing hands, above last year's daily average of 1.61 billion, while on Nasdaq, about 2.17 billion shares traded, above last year's daily average of 1.80 billion.
Declining stocks outnumbered advancing ones by a ratio of about 9 to 7 on the NYSE and by about 19 to 11 on Nasdaq.
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