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US Stocks Close Mixed, With Apple Shining, Sprint Sluggish January 9, 2007

Posted by notapundit in Economic News.
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NEW YORK (Dow Jones)–Stocks ended mixed amid more volatility, with Apple’s innovation placing its shares at an all-time high, investors fleeing a troubled Sprint Nextel, Cheesecake Factory surging on solid sales and International Business Machines recapturing 100.

The Dow Jones Industrial Average lost 6.89, or 0.06%, to 12416.60, after being up as much as 43 points. The Nasdaq Composite rose 5.63, or 0.23%, to 2443.83. The Standard & Poor’s 500 Index shed 0.73, or 0.05%, to 1412.11.

“The day was dominated by oil’s movement,” with the stock market moving up as the price of crude fell a bit and heading lower as it rose, said Kevin Beadles, managing director of equity trading at Wedbush Morgan. “People are keying in on crude right now, because it’s really the only market-moving event. But things will shift as corporate profits begin being focussed on.”

Apple (Nasdaq) jumped 7.10, or 8.3%, to 92.57, its best close ever. The company announced it soon will begin selling the iPhone, a cellphone that will allow users to make calls, surf the Web, receive email or listen to music. The announcement came at Apple’s annual Macworld meeting, at which Chief Executive Steve Jobs also said that, effective immediately, Apple is dropping the word “Computer” from its name. The iPhone news had a considerable impact on Research in Motion, the maker of the BlackBerry handheld communications device. Shares fell 11.16, or 7.9%, to 131 on the Nasdaq.

Sprint Nextel lost 2.19, or 11%, to 17.45, the Big Board’s fourth biggest percentage decliner. The wireless service provider warned revenue will stay relatively flat this year and said spending to improve its cellular and broadband networks will hurt its profit in the near term. The company also said it would cut 5,000 jobs, or about 8% of its work force.

Cheesecake Factory (Nasdaq) gained 2.43, or 9.9%, to 26.99. The casual dining chain said preliminary fourth-quarter revenue rose 18% to $360.4 million, ahead of analysts’ expectations for $353.98 million.

International Business Machines continued its 2007 momentum, rising 1.17, or 1.2%, to 100.07, its first close over 100 since Feb. 4, 2004, and the Dow industrial average’s best advancer.

Volume on the New York Stock Exchange was 1.71 billion shares. Down volume beat up by 921 million to 763 million, and stocks that rose in value exceeded those that fell, 1,875 to 1,446.

The final Dow Jones Industrial Average close was 12416.60 down 6.89. On the New York Stock Exchange, there were 1,875 issues advancing, 1,446 declining and 154 unchanged.

NYSE volume totaled 1,765,976,450 shares, compared with 1,612,739,410 Monday.

The NYSE Composite Index was 9023.90, down 17.22. The average price per share fell by 32 cents.

Alcoa ended with a modest advance of 4 cents to 28.52 after choppy trading for much of the day. Investors were tentative ahead of the aluminum giant kicking off fourth-quarter earnings season after the bell, as the first Dow industrial member to be heard from. Net income rose 60% to $359 million, or 41 cents a share, while revenue grew 20% to $7.84 billion.

WebMD Health (Nasdaq) gained 3.88, or 9.4%, to 45.15. The health information services provider said better-than-expected online advertising revenue will push its fourth-quarter earnings above the high end of its estimated range and revenue is expected to be about $79 million to $80 million, above the range of $73.5 million to $76.5 million previously provided. Emdeon (Nasdaq), WebMD’s majority owner, advanced 51 cents, or 4.1%, to 12.95.

Lazard rose 3.10, or 6.6%, to 50.19. Goldman Sachs added shares to its “Americas Buy List,” saying the investment bank is well-positioned to capitalize on robust global merger and acquisition trends and its stock has the potential to grow by close to 25% over the next 12 months.

Celgene (Nasdaq) lost 2.45, or 4.3%, to 54.85. The maker of gene- and protein-based cancer and inflammatory disease treatments issued a 2007 earnings forecast below the mean Wall Street estimate due, in part, to timing issues for getting its drugs to market.

Garmin (Nasdaq) fell 2.07, or 3.8%, to 51.93. Merrill Lynch cut shares of the global-positioning-system maker to neutral from buy, saying it expects the company to lose three percentage points of market share in 2007 as a barrage of new devices are introduced.

Tiffany gained 92 cents, or 2.4%, to 39.62. Investors anticipate good news from the high-end jeweler on Wednesday, when it’s expected to report holiday sales.

West Pharmaceutical Services dropped 4.03, or 7.9%, to 47.30. Lehman Brothers cut shares to underweight from equal weight, feeling the closure-systems and syringe component maker’s recent margin expansion may face a bit more headwind in 2007 and into 2008.

Supervalu lost 61 cents, or 1.7%, to 35.16. The food store chain’s fiscal third-quarter profit jumped amid last year’s acquisition of 1,100 Albertson’s supermarkets, but at 54 cents a share, the earnings fell short of analysts’ expectations for 56 cents.

St. Jude Medical gained 1.81, or 4.9%, to 38.76 after a 5.6% rise on Monday. The stock started moving after the medical-device maker preannounced fourth-quarter revenue above Wall Street expectations, signaling a possible turnaround in the market for its key implantable defibrillator device.

BP PLC’s American depositary shares lost 1.85, or 2.9%, to 62.44. The British oil major said it expects to report near flat production in the fourth quarter of 2006, meaning it will likely miss its production target for the year.

Endo Pharmaceuticals (Nasdaq) gained 63 cents, or 2.2%, to 29.48. The specialty pharmaceutical company said it expects 2007 revenue of $1.025 billion to $1.05 billion, when Wall Street is looking for $1.025 billion.

Sirius Satellite Radio (Nasdaq) shed 5 cents, or 1.3%, to 3.71. The satellite radio broadcaster surpassed its year-end 2006 subscriber targets and, for his assistance, gave shock jock Howard Stern and his affiliates 22.1 million shares, worth $82.9 million.

Talbots slipped 14 cents to 23.32. The women’s apparel retailer said it sees a break-even, not profitable, fourth quarter, as markdowns are having an impact.

Juniper Networks (Nasdaq) lost 17 cents to 20.06. The networking technology company will pay new Chief Operating Officer Stephen Elop a $540,000 salary, and has set his bonus at 25% above his base salary while awarding him 300,000 options, according to a filing with the Securities and Exchange Commission.

Indosat’s American depositary receipts lost 1.57, or 4.3%, to 35.13. Citigroup cut shares of the Indonesian telecommunications company to sell from hold, saying that while it expects a meaningful earnings turnaround in 2007, the market is pricing in an even bigger recovery.

By Karen Talley, Dow Jones Newswires

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