Dow, S&P 500 end down slightly as Apple, energy weigh

The Dow and the S&P 500 edged lower on Monday as energy shares dropped with oil prices and Apple retreated a day before its quarterly results.

Investors were cautious ahead of the Federal Reserve's two-day policy meeting, which begins on Tuesday. The market is looking for clues on the outlook for when the Fed may begin raising interest rates.

Apple shares fell 3.2 percent to $115.28, making it the biggest drag on all three major indexes, while a weak outlook from one of its suppliers, Dialog Semiconductor , led a fall in other semiconductors. An index of semiconductors was down 2 percent after three days of gains.

The iPhone maker reports quarterly results after the market closes on Tuesday.

"With Apple, it's more about their forecast and China news and any upgrades they may want to announce," said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.

The S&P energy sector fell 2.5 percent, leading sector declines for the S&P 500. Crude oil prices slipped as global oversupply pushed fuel storage sites close to capacity. Exxon fell 2.1 percent to $81.22, while Chevron was down 2.7 percent to $88.77.

US stocks have mostly gained in October after a weak third quarter. The S&P 500 is up 7.9 percent for the month so far.

"It's been a pretty big move up, so we're seeing a little bit of consolidation today," Meckler said.

The Dow Jones industrial average fell 23.65 points, or 0.13 percent, to 17,623.05, the S&P 500 lost 3.97 points, or 0.19 percent, to 2,071.18 and the Nasdaq Composite added 2.84 points, or 0.06 percent, to 5,034.70.

Among the top Nasdaq gainers, shares of Ctrip.com were up 22.1 percent at $90.78 after the online travel firm said it would merge with Qunar Cayman Islands. Qunar jumped 7.9 percent to $42.65.

Strong quarterly results from tech companies have helped improve expectations for overall US third-quarter earnings.

S&P 500 earnings are forecast to have declined 2.8 percent in the quarter, based on actual results from about 35 percent of the S&P 500 companies and estimates for the rest, compared with a 4.2 percent decline forecast at the start of the month, according to Thomson Reuters data.

Data showed new US home sales fell 11.5 percent in September, suggesting a softening of the housing market. An index of housing shares was down 0.4 percent.

Other gainers included Pep Boys, which jumped 23.4 percent to $14.99 after it agreed to be acquired by Bridgestone for $15 per share.

Piedmont Natural Gas rose 36.9 percent to $57.82 after it agreed to be bought by Duke Energy. Duke Energy fell 2 percent.

After the bell, shares of Hartford Financial fell 4.7 percent to $46.50 following its results.

During the session, NYSE declining issues outnumbered advancers 1,916 to 1,153, for a 1.66-to-1 ratio; on the Nasdaq, 1,749 issues fell and 1,077 advanced, for a 1.62-to-1 ratio favoring decliners.

The S&P 500 posted 36 new 52-week highs and eight lows; the Nasdaq recorded 111 new highs and 73 lows.

About 6.1 billion shares changed hands on US exchanges, below the 7.3 billion daily average for the past 20 trading days, according to Thomson Reuters data. — Reuters

Wall St gains as Ukraine worry cools, M&A lift

NEW YORK - US stocks advanced on Monday, as the threat of an escalation of tensions in Ukraine appeared to diminish and the latest flurry of merger action supported equities.

Russia said all issues related to its humanitarian convoy to Ukraine had been resolved but said no progress has been made toward a ceasefire or political solution to the fighting in the east of the country after talks between Russia, Germany, France and Ukraine on Sunday.

However, the region remained unsettled as Ukraine accused pro-Russian rebels on Monday of hitting a refugee convoy of buses with rocket fire near the eastern city of Luhansk, but the separatists denied responsibility.

Mergers and acquisitions continue to flourish and provide a lift to equities.

Discount retailer Dollar General Corp offered to buy Family Dollar Stores Inc for $8.95 billion, trumping an offer by Dollar Tree Inc. Family Dollar shares gained 4.3 percent to $79.35 while Dollar General jumped 9.4 percent to $62.87 as the best performer on the S&P 500. The S&P retail index climbed 1.1 percent.

"People left Friday unsure of whether or not the Ukrainian conflict was escalating and they seem to have come back today thinking it's not," said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.

"That has been the major driver, but then you have the usual suspects of what has supported this market all along - a somewhat improving economy and continued M&A activity, giving people confidence that higher stock prices are here to stay."

Sensors and electrical controls maker Sensata Technologies Holding NV said it would buy the Schrader group of companies for an enterprise value of $1 billion. Sensata shares rose 4.9 percent to $48.44.

Ingersoll-Rand Plc, a maker of heating and air conditioning systems, said it would buy Cameron International Corp's centrifugal compression unit for $850 million. Ingersoll shares gained 1.6 percent to $61.54 and Cameron shed 0.2 percent to $72.47.

The Dow Jones industrial average rose 128.17 points or 0.77 percent, to 16,791.08, the S&P 500 gained 13.31 points or 0.68 percent, to 1,968.37 and the Nasdaq Composite added 30.18 points or 0.68 percent, to 4,495.11.

In a relatively light week for economic data, investors will closely monitor the Aug. 21-23 annual meeting of top central bankers at Jackson Hole, Wyoming, for possible insight about the path for monetary policy.

Minutes from the Federal Reserve's July meeting will be released on Wednesday.

Earnings season will effectively draw to a close this week with results from retailers including Home Depot, Target Corp and Gap Inc.

According to Thomson Reuters data through Monday, of the 467 companies in the S&P 500 that have reported earnings, 67.9 percent have topped analyst expectations, besting the 63 beat rate since 1994 and the 67 percent rate for the past four quarters. — Reuters

Wall St edges up following strong jobs report

NEW YORK - U.S. stocks edged higher on Friday following a payroll report that suggested a sharp rebound in economic activity early in the second quarter.

Still, while the report provided an encouraging read on the labor market, investors said Wall Street's gains over the week made further advances unlikely.

U.S. job growth increased at its fastest pace in more than two years in April and the unemployment rate dived to a 5-1/2 year low of 6.3 percent, the Labor Department said. The payrolls gain of 288,000 was the largest since January 2012 and beat Wall Street's expectations for an increase of just 210,000.

The unemployment rate tumbled 0.4 percentage point, touching its lowest level since September 2008. The Labor Department attributed the decline to a drop in the number of unemployed people reentering the labor market as well as a fall in new entrants into the labor force.

"The headline number handily beat expectations, which bodes well for the whole weather theme we saw throughout the first quarter," said Adam Sarhan, chief executive of Sarhan Capital in New York.

"We'll move higher on this but we had a big move this week. We're at resistance right now, and it may take a little bit of time to break above that."

The Dow Jones industrial average rose 30.96 points, or 0.19 percent, to 16,589.83, the S&P 500 gained 3.57 points, or 0.19 percent, to 1,887.25 and the Nasdaq Composite added 1.412 points, or 0.03 percent, to 4,128.863.

For the week, the Dow has gained 1.4 percent, while the S&P 500 and the Nasdaq are both up 1.3 percent.

In company news, U.S. drug maker Pfizer Inc 's sweetened 63 billion pound ($106 billion) bid for AstraZeneca Plc was promptly rejected by the British company Friday. Pfizer shares were down 1 percent at $30.84.

LinkedIn Corp shares slipped 4.7 percent to $153.68, a day after the social networking company forecast 2014 revenue below Wall Street's expectations, underscoring concerns about its ability to sustain its rapid growth.

Shares of Ares Management LP, the first U.S. private equity firm to go public in about two years, fell to a low of $18 in early trading on the New York Stock Exchange after being priced at $19, well below the expected range of $21-23, in a turbulent IPO market. They were last trading at $18.39.

German drug maker Bayer AG is nearing an agreement to buy Merck & Co Inc's consumer healthcare unit, people familiar with the matter said, in a deal that could value the business at around $14 billion. Merck shares lost 1.2 percent to $58.93. — Reuters

source: gmanetwork.com

Stocks fall as Nasdaq slides; dollar eases on jobs data

NEW YORK - A slide in biotech stocks pulled Wall Street and a measure of global equities lower on Friday despite a solid U.S. jobs report that weakened the dollar on views that the Federal Reserve will keep scaling back its stimulus.
   
The U.S. bond market, surprisingly, rallied, particularly five-year Treasury notes, which had been weak lately on fears the Fed could raise interest rates earlier than anticipated.
   
The FTSEurofirst 300 index of European shares touched a peak last seen in 2008 on the U.S. jobs data and closed higher, for a ninth straight gain and marking the third consecutive week of higher closes.
   
But stocks on Wall Street retreated after stabilizing earlier in the week as momentum stocks such as biotechs fell for a second straight session. The Nasdaq biotech index lost 4.01 percent, and the Nasdaq composite fell 2.6 percent in its worse single-day loss in two months.
   
The decline pulled down U.S. stocks and global equities.
   
"You've got some big names in there. There is a high correlation inside of those groups," said Keith Bliss, senior vice president at Cuttone & Co in New York. "Managers tend to trade the entire group as opposed to individual names. So that of course, is hitting the Nasdaq and everybody else."
   
Equities had opened higher on optimism spurred by the U.S. nonfarm payrolls report, which a gain of 192,000 jobs in March, just shy of the 200,000 forecast, after rising 197,000 in February. The unemployment rate was unchanged at 6.7 percent.
   
With a solid pace of hiring for a second month, the U.S. economy appears to be recovering from a winter slowdown.

A smaller survey of households, from which the unemployment rate is derived, showed a much bigger surge in employment. That jump was met by a rise in the number of people entering the labor force, a show of confidence in the U.S. job market.
   
The percentage of working-age Americans with a job reached its highest level since the summer of 2009.
   
"I'm surprised by the overall weakness today, but since it is concentrated in names that have been weak, I think it is just a continuation of that. I'm not concerned about this spilling over to the broader market," said David Joy, chief market strategist at Ameriprise Financial in Boston, where he helps oversee $703 billion in assets under management.
   
"We've been in a trading range, finding resistance at record levels, so this isn't cause for alarm. The data is getting stronger, which suggests we have an opportunity to move higher with participation from other groups," Joy said.
   
The S&P 500 hit a record high before retreating. MSCI's all-country world stock index fell 0.45 percent.
   
The Dow Jones industrial average fell 159.84 points, or 0.96 percent, to 16,412.71. The S&P 500 lost 23.68 points, or 1.25 percent, to 1,865.09, and the Nasdaq Composite dropped 110.014 points, or 2.6 percent, to 4,127.726.
   
For the week, the Dow rose 0.6 percent, the S&P gained 0.4 percent, and the Nasdaq fell 0.7 percent.
   
Bond prices rose, with the five-year up 13/32 in price to yield 1.7022 percent. The benchmark 10-year U.S. Treasury note rose 17/32 in price to yield 2.7261 percent.
   
"This (jobs) number doesn't give any reason to move up the Fed timing of rate hikes, which is what was feared most," said John Briggs, U.S. rates strategist at RBS in Stamford, Connecticut.
   
The FTSEurofirst 300 index closed up 0.56 percent at 1,352.78.
   
The dollar was choppy against the euro and declined against other major currencies despite the U.S. jobs gains.
   
"It's a Goldilocks report, not too warm and not too cold, and puts pressure on the next report in May to be good," Anthony Valeri, investment strategist at LPL Financial in San Diego, said. "It doesn't change the pace of tapering and shows the economy is still on track."
   
The greenback was up 0.14 percent against the euro at $1.3695. It fell 0.66 percent to 103.22 against the Japanese yen after hitting a session high of 104.12 yen in trading immediately after the employment report.
   
Brent crude rose above $106 a barrel as expectations of a deal to reopen vital Libyan oil ports were offset by doubts that a lasting resolution was imminent.
   
Brent crude settled up 57 cents at $106.15 a barrel. U.S. crude, or West Texas Intermediate, rose 85 cents to settle at $101.14 a barrel. — Reuters

source:  gmanetwork.com