Shares of Supervalu Inc (SVU.N) fell nearly 6 percent after Morgan Stanley told investors to cut holdings in the stock, saying rising food costs will crimp margins. Safeway Inc (SWY.N) and Whole Foods Market (WFMI.O) also slid.
The S&P materials index (.GSPM) slipped 0.9 percent, as did the energy index (.GSPE) as investors took profit in the commodities space. Materials and energy were among top-performing sectors in 2010.
The S&P and Nasdaq pared losses modestly and the Dow edged higher following minutes from the Federal Reserve’s December policy meeting that showed officials felt the U.S. economic recovery was still weak enough to warrant monetary support despite growing signs of strength.
The market was supported by strength in defensive shares, including the utilities and telecom sectors.
“The S&P is pretty buoyant because of the fact that there seems to be a little bit of a renewed interest in the market,” said Nick Kalivas, senior equity index analyst at MF Global in Chicago.
“I think it’s subtle but I do think it’s present. How long it lasts is obviously the million dollar question.”
The Dow Jones industrial average (.DJI) added 17.75 points, or 0.15 percent, to 11,688.50. The Standard & Poor’s 500 Index (.SPX) was off 3.07 points, or 0.24 percent, to 1,268.80. The Nasdaq Composite Index (.IXIC) slipped 9.71 points, or 0.36 percent, to 2,681.81.