Dow closes at record high, S&P snaps 4-day winning streak; techs drag
Published: Tuesday, 23 Jul 2013 | 4:03 PM ET
By: JeeYeon Park | CNBC.com Stock Market Writer
Stocks finished narrowly mixed in
lackluster trading Tuesday, but the Dow posted a fresh closing high, as
investors weighed a handful of upbeat earnings against a weak regional
factory report.
"This week, we're entirely focused on a market that is luckily treating earnings on a case-by-case basis," said Art Hogan, managing director at Lazard Capital Markets. "You've got a general market trend where investors are comfortable with stocks for now—for now, we've a better understanding of Fed tapering means."
"This week, we're entirely focused on a market that is luckily treating earnings on a case-by-case basis," said Art Hogan, managing director at Lazard Capital Markets. "You've got a general market trend where investors are comfortable with stocks for now—for now, we've a better understanding of Fed tapering means."
| Name | Price | Change | %Change | ||||
|---|---|---|---|---|---|---|---|
| DJIA | Dow Jones Industrial Average | 15567.74 | 22.19 | 0.14% | |||
| S&P 500 | S&P 500 Index | 1692.39 | -3.14 | -0.19% | |||
| NASDAQ | Nasdaq Composite Index | 3579.27 | -21.11 | -0.59% |
The Dow Jones Industrial Average finished in positive territory, led by United Tech and Boeing. The blue-chip index traded in a tight 60-point range.
The S&P 500 and the Nasdaq closed slightly lower. Earlier, the S&P 500 traded within two points of touching the 1,700 mark. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, dipped near 12.
(Read more: 'Walking Dead' market: Why the rally keeps going)
Among key S&P sectors, telecoms led the gainers, while consumer staples dipped.
Apple's tough quarter, 'lost year': analyst
Daniel Ernst, Hudson Square
Research Inc., says he continues to see fiscal year 2013 as Apple's
"lost year." He says he's not excited about a cheap iPhone, because it's
like asking Audi to sell a cheap car.
DuPont
rallied after the chemical company edged past earnings expectations by a
penny and said it is exploring selling its performance chemicals unit.
Fellow Dow component United Technologies
rose after the multinational conglomerate beat profit estimates and
lifted the lower end of its yearly forecast and said it is well
positioned for a return to organic growth in the second half of the
year.
Travelers reported quarterly results that topped forecasts as the firm saw fewer catastrophic losses. Still, shares of the insurance company slid.
Peabody Energy reported a lower profit due to weak prices, but shares of the coal company soared to lead the S&P 500 gainers as the results still topped analysts' expectations.
Texas Instruments jumped after the chipmaker posted better-than-expected quarterly results and handed in current-quarter guidance that exceeded expectations.
Netflix declined after the online entertainment company posted a smaller-than-expected quarterly subscriber growth, though the company topped earnings expectations.
(Read more: 'The big picture isgreat': Netflix's Hastings)
After the closing bell, investors will be focused on Apple as the iPhone maker is due to post results. Analysts expect the tech giant to post earnings of $7.32 a share on sales of $35 billion.
(Read More: Why investors should look past Apple's 'horrendous' earnings)
So far this quarter, technology has been one of the most disappointing sectors so far, with results from Microsoft, Google, and Intel missing analysts' forecasts.
In addition, AT&T, VMWare, Broadcom, and Discover Financial are among other notable companies to post earnings after the bell.
(Read More: Earnings delugebegins today—here's what to expect)
Travelers reported quarterly results that topped forecasts as the firm saw fewer catastrophic losses. Still, shares of the insurance company slid.
Peabody Energy reported a lower profit due to weak prices, but shares of the coal company soared to lead the S&P 500 gainers as the results still topped analysts' expectations.
Texas Instruments jumped after the chipmaker posted better-than-expected quarterly results and handed in current-quarter guidance that exceeded expectations.
Netflix declined after the online entertainment company posted a smaller-than-expected quarterly subscriber growth, though the company topped earnings expectations.
(Read more: 'The big picture isgreat': Netflix's Hastings)
After the closing bell, investors will be focused on Apple as the iPhone maker is due to post results. Analysts expect the tech giant to post earnings of $7.32 a share on sales of $35 billion.
(Read More: Why investors should look past Apple's 'horrendous' earnings)
So far this quarter, technology has been one of the most disappointing sectors so far, with results from Microsoft, Google, and Intel missing analysts' forecasts.
In addition, AT&T, VMWare, Broadcom, and Discover Financial are among other notable companies to post earnings after the bell.
(Read More: Earnings delugebegins today—here's what to expect)
Economic outlook: Jobs, GDP & the Fed
CNBC's Steve Liesman and Rick
Santelli discuss the economy, GDP and Real Gross Domestic Income, as
well as the Fed and when tapering might come. With Wilbur Ross.
Cisco Systems announced it will acquire software maker Sourcefire
in a deal worth nearly $2.7 billion in an effort to beef up network
security offerings. The network equipment company said the deal would
likely close during the second half of the year. Sourcefire shares
surged nearly 30 percent following the announcement.
On the economic front, manufacturing activity in the central Atlantic region contracted in July, dropping to -11 from a downward revised 7 in June, according to the Federal Reserve Bank of Richmond. A above zero indicates an expansion.
Treasury prices remained lower after the government auctioned $35 billion in 2-year notes at a high yield of 0.336 percent. The bid-to-cover ratio, an indicator of demand, was 3.08, versus a recent average of 3.54.
In global markets, Chinese stocks boosted shares across Asia following market rumors that China could take stimulus measures to boost its economy.
Chinese shares outperformed after state newspaper Beijing News reported that Chinese Premier Li Keqiang had said the government would not allow the country's gross domestic product growth to fall below 7 percent.
Comments from China's vice-premier, Zhang Gaoli, also bolstered sentiment this week. He reiterated Beijing's commitment to supporting the export and services industries, while steering the economy towards consumer-oriented growth, according to Reuters.
The Shanghai Composite rallied 2 percent on Tuesday, while the Hang Seng Index jumped 2.5 percent. Elsewhere, South Korea'sKospi hit a five-week high.
"Momentum remains positive for equities, which were given a further boost this morning as Premier Li confirmed that the minimum level for growth in China would be 7 percent, raising the potential prospect of stimulus measures to support the Chinese economy and its bottom line growth target," Rebecca O'Keeffe, head of investment at Interactive Investor, said on Tuesday.
On the economic front, manufacturing activity in the central Atlantic region contracted in July, dropping to -11 from a downward revised 7 in June, according to the Federal Reserve Bank of Richmond. A above zero indicates an expansion.
Treasury prices remained lower after the government auctioned $35 billion in 2-year notes at a high yield of 0.336 percent. The bid-to-cover ratio, an indicator of demand, was 3.08, versus a recent average of 3.54.
In global markets, Chinese stocks boosted shares across Asia following market rumors that China could take stimulus measures to boost its economy.
Chinese shares outperformed after state newspaper Beijing News reported that Chinese Premier Li Keqiang had said the government would not allow the country's gross domestic product growth to fall below 7 percent.
Comments from China's vice-premier, Zhang Gaoli, also bolstered sentiment this week. He reiterated Beijing's commitment to supporting the export and services industries, while steering the economy towards consumer-oriented growth, according to Reuters.
The Shanghai Composite rallied 2 percent on Tuesday, while the Hang Seng Index jumped 2.5 percent. Elsewhere, South Korea'sKospi hit a five-week high.
"Momentum remains positive for equities, which were given a further boost this morning as Premier Li confirmed that the minimum level for growth in China would be 7 percent, raising the potential prospect of stimulus measures to support the Chinese economy and its bottom line growth target," Rebecca O'Keeffe, head of investment at Interactive Investor, said on Tuesday.
@JeeYeonParkCNBC) On Tap This Week:
WEDNESDAY: MBA mortgage applications, PMI mfg index, new home sales, oil inventories, 5-yr note auction, Dell shareholder mtg, Google breakfast; Earnings from Boeing, Caterpillar, Eli Lilly, Ford, GlaxoSmithKline, PepsiCo, Facebook, Qualcomm, Visa, Akamai, Baidu
THURSDAY: Durable goods orders, jobless claims, natural gas inventories, Kansas City Fed mfg index, 7-yr note auction, Fed balance sheet/money supply, weekly rail numbers, USDA food prices outlook; Earnings from Bristol-Myers, GM, 3M, Colcate-Palmolive, Credit Suisse, Sirius XM, Amazon.com, Gilead Sciences, Starbucks, Zynga
FRIDAY: Consumer sentiment, AT&T Next debuts; Earnings from Tyco
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