Stocks drift lower as dollar rallies and Senate passes tax-cut bill

Stocks on Wall Street drifted lower, erasing an early-session rally, as the dollar jumped and traders weighed a credit downgrade warning on Spain and the U.S. Senate’s passage of the $885-billion tax cut extension bill.

Stocks rallied early on some positive U.S. economic data, including a rise in November industrial production and a rebound in manufacturing activity in New York. Also, the consumer price index edged up in November.

The Dow Jones Industrial average fell 19.07 points, or 0.17 percent, to 11,457.47. The S&P 500 Index dropped 6.36 points, or 0.51 percent, to 1,235.23. The Nasdaq Composite slipped 10.50 points, or 0.40 percent, to 2,617.22.

Honeywell International Inc (NYSE:HON) slid 1.88 percent on a disappointing 2011 profit growth forecast.

Boston Beer Co. (NYSE: SAM) soared 12.06 percent after the brewer raised its earnings forecast for the remainder of this year and into 2011.
Oil futures edged up to $88.46 per barrel, while gold futures fell to $1385.50 per ounce.

Bonds lost value as the yield on the benchmark 10-year U.S. Treasury Note rose to 3.52 percent.

European/UK stocks finished lower, largely on euro zone debt fears.

Britain's FTSE 100 slipped 0.15 percent, France's CAC 40 shed 0.58 percent, and the German DAX lost 0.16 percent.