|Page (1) of 1 - 09/21/12||email article||print page|
Wall Street up on iPhone and Spain, but indexes off highsUS-MARKETS-STOCKS:Wall Street up on iPhone and Spain, but indexes off highs
By Aleksandra Michalska
NEW YORK (Reuters) - U.S. stocks gained on Friday after Apple's iPhone went on sale worldwide, driving the company's shares up to a lifetime high, and Spain looked closer to seeking a bailout.
Apple Inc <AAPL.O>, the world's most valuable company in terms of market value, lifted the broad stock market after the latest iPhone went on sale worldwide. The company's stock jumped to an all-time high of $705.07 earlier in the session. By late afternoon, Apple was up 0.5 percent at $702.10.<ID:L4E8KL3G1>
News from Spain helped lift stocks after the debt-laden country said it was considering freezing pensions and speeding up a planned rise in the retirement age as it raced to cut spending and meet conditions of an expected international sovereign aid package.
"The Spain news was relatively small," said Joseph Greco, managing director of Meridian Equity Partners in New York, although he pointed out that "the euro-dollar currency play resulting from that news was definitely something that we spoke about. But it's been a lot of back and forth. I don't anticipate there will be much more room there."
The Dow Jones industrial average <.DJI> rose 7.35 points, or 0.05 percent, at 13,604.28, well off its session high of 13,647.10. The Standard & Poor's 500 Index <.SPX> edged up 1.64 points, or 0.12 percent, to 1,461.90. The Nasdaq Composite Index <.IXIC> rose 6.25 points, or 0.20 percent, to 3,182.21.
Earlier, the S&P 500 hit an intraday high of 1,467.07, while the Nasdaq reached a session high of 3,196.93.
A quick and sharp sell-off in spot gold shortly after midday, driven by a rumor that the CME may raise margin requirements on commodities, weighed on financial services stocks, according to Greco. Many banks and other companies in the financial sector have high exposure to gold and other commodities, so any increase in margin requirements would affect them, Greco explained.
Spot gold later recovered to trade up 0.6 percent at $1,777.19 an ounce by 1:11 p.m. EDT on Friday, after hitting a session high of $1,787.20 - close to its 2012 high of $1,790.30.
But financial shares were still slightly lower by late afternoon on Friday, with the S&P financial index <.GSPF> down 0.1 percent.
The transportation sector limited the market's advance on Friday, when the Dow Jones Transportation Average <.DJT> fell 1 percent. Earlier this week, two large shipping companies - FedEx Corp. <FDX.N> and Norfolk Southern Corp. <NSC.N> - warned about the impact of the weakening world economy on their results.
In late Friday afternoon trading, FedEx shares slid 1.1 percent to $84.28 and Norfolk Southern shares lost 1.4 percent to $65.16. On Wednesday, a few brokerage firms cut their price targets on FedEx stock. On Friday, four brokers lowered their price targets on Norfolk Southern's stock.
The benchmark Standard & Poor's 500 Index <.SPX> has gained 6 percent since the start of August, mostly on expectations for new economic stimulus measures from the world's central banks. On September 13, the Federal Reserve announced a third round of stimulus or quantitative easing, known as Q3, intended to bolster the economy and reduce U.S. unemployment.
There may be increased volatility toward Friday's close because of "quadruple witching," the quarterly settlement and expiration of four different types of September equity futures and options contracts. Expiration can lead to greater volume and volatility as players adjust or exercise their derivative positions.
Looking ahead to quarterly earnings, one bright spot came from the fashion front. Shares of Michael Kors Holdings Ltd <KORS.N> shot up 6.7 percent to $56. The fashion and accessory designer's company, whose New York Fashion Week runway show was packed with A-list celebrities, said it will likely earn more than it expected in the second quarter as it banks on strong global sales.
Housing shares advanced, led by KB Home <KBH.N>, up nearly 17 percent at $15.32 after the fifth-largest U.S. homebuilder reported a surprising quarterly profit and said its revenue backlog hit a four-year high. The PHLX housing sector index <.HGX> climbed 2.3 percent.
Oracle Corp <ORCL.O> gained 1.2 percent to $32.66 a day after the software maker reported first-quarter earnings, excluding items, that met Wall Street's expectations. Oracle's hardware sales, however, are expected to drop further after tumbling 24 percent from a year ago.
Darden Restaurants Inc <DRI.N>, whose dining-out brands include the Italian food chain, the Olive Garden, posted first-quarter earnings that beat analysts' estimates. Darden stood by its sales and profit forecast for the year. It stock rose 4.1 percent to $56.96.
In the pharmaceutical sector, a sour note came from drug-development company Vivus Inc. <VVUS.O> Its stock lost 12.7 percent to $20.71 after Vivus said it expects a European committee to recommend against the approval of its obesity drug Qsiva, based on preliminary feedback from the committee.
(Editing by Jan Paschal)
Related Keywords:US , MARKETS , STOCKS