Don’t miss the latest developments in business and finance.

Wall St dips after record highs, Apple jumps

Image
Reuters NEW YORK
Last Updated : Jul 24 2013 | 10:45 PM IST

By Rodrigo Campos

NEW YORK (Reuters) - U.S. stocks slipped on Wednesday, but the S&P 500 and Dow industrials held near record highs as weak earnings from blue-chips Caterpillar and AT&T outweighed Apple's stronger-than-expected results.

The S&P 500 came within 2 points of 1,700 but has fallen short of breaking through for a fifth straight day, pointing to technical resistance.

The S&P could bump against 1,700 several more times as happens with other round numbers considered psychological levels, said Darrell Cronk, regional chief investment officer at Wells Fargo Private Bank in New York.

After a healthy start to the earnings season, mainly because of strong numbers from Wall Street's top banks, the technology, industrial and basic materials sectors have not maintained the pace.

"We're getting results from sectors that by their nature are going to have slowest growth," Cronk said, pointing to lower commodity prices as trouble for miners.

More From This Section

The market got some support from data showing private industry in the euro zone expanded for the first time in more than a year and U.S. factories also posted a strong month, but Chinese manufacturing continued to lose steam.

U.S. new-home sales jumped to a five-year high in June, showing no signs of slowing in the face of higher mortgage rates.

Apple , the world's largest technology company, rose 5.5 percent to $441.95 a day after it reported earnings and revenues that beat Wall Street's estimates, and lead the Nasdaq and the S&P tech sector higher.

The S&P tech sector gained 1 percent.

Utilities was the worst performing sector among 10 in the S&P 500, showing all 31 components falling.

The Dow Jones industrial average fell 49.24 points or 0.32 percent, to 15,518.5, the S&P 500 lost 5.48 points or 0.32 percent, to 1,686.91 and the Nasdaq Composite added 6.24 points or 0.17 percent, to 3,585.51.

Out of the 169 companies in the S&P 500 that have reported earnings so far this season, 65.7 percent have beaten analysts' expectations for earnings and 53.3 percent have posted revenue above forecasts. Over the past four quarters, 67 percent of companies have beaten earnings estimates.

Caterpillar and AT&T disappointed investors after posting results. Caterpillar shares fell 2.5 percent to $83.34 and AT&T was off 2.3 percent at $35.01.

Boeing Co , also a Dow component, posted better-than-expected second-quarter results but the stock fell 0.7 percent to $107 after hitting a lifetime high of $109.48.

Broadcom shares tumbled 15.7 percent to $26.84 a day after the chipmaker forecast lower-than-expected third-quarter revenue. At least four brokerages cut their rating and about 10 lowered their price targets on Broadcom's stock.

Shares of Maidenform Brands jumped 22.6 percent to $23.41 after rival Hanesbrands said it will buy the company for $547 million.

The three stocks trading most actively relative to their average volume on the NYSE were Bank of America , which fell 1.1 percent to $14.78, Ford , up 3.3 percent to $17.50 and EMC Corp , which rose 6 percent to $26.85.

(Reporting by Rodrigo Campos; Editing by Kenneth Barry)

Also Read

First Published: Jul 24 2013 | 10:30 PM IST

Next Story