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US Stocks Gain, With Alcoa, Apple Strong Advancers January 10, 2007

Posted by notapundit in Economic News, Main.

NEW YORK (Dow Jones)–Stocks finished higher after another choppy session, with Alcoa and Apple posting strong advances while Chevron and Tiffany lost some luster.

The Dow Jones Industrial Average rose 25.56, or 0.21%, to 12442.16, after being off close to 61 points. The Nasdaq Composite rose 15.50, or 0.63%, to 2459.33. The Standard & Poor’s 500 Index advanced 2.74, or 0.19%, to 1414.85.

Oil’s continued slide has raised some concerns about slower economic growth, and a Federal Reserve president echoed his colleagues’ recent concerns about inflation. But, “we’re also consolidating what’s been a phenomenal move in the stock market,” said Christopher Zook, chief investment officer at CAZ Investments. “Part of the reason it’s occurring now is because people are a bit nervous about what the fourth-quarter earnings season will hold.”

Dow industrial Alcoa got things off in fine fashion, gaining 1.71, or 6%, to 30.23. The world’s largest aluminum producer posted robust results late Tuesday, suggesting that in some areas, at least, commodity prices and demand are not severely eroding.

Apple (Nasdaq) continued its advance, rising 4.43, or 4.8%, to 97, another record close. The gain came after an 8.3% leap on Tuesday, when the company announced its new iPhone, a cellphone that will allow users to make calls, surf the Web, receive email or listen to music. The news reverberated, with, among cellphone makers, Nokia’s American depositary shares losing 30 cents, or 1.5%, to 19.08. There was also plenty of speculation about which component companies will play a role in the iPhone’s production. Among the names mentioned, Marvell Technology Group gained 1.15, or 5.8%, to 20.88, and Nvidia rose 1.64, or 4.9%, to 34.89, both on the Nasdaq.

Chevron lost 1.22, or 1.7%, to 69.41. The energy giant expects fourth-quarter results to be adversely affected by lower commodity prices and lower downstream margins relative to third-quarter earnings.

Tiffany dropped 82 cents, or 2.1%, to 38.80. The high-end jeweler reported strong holiday sales, but some analysts noted that margins continue to be pressured.

Volume on the New York Stock Exchange was about 1.6 billion shares. Up volume beat down by 867 million to 676 million, and stocks that rose in value exceeded those that fell, 1,684 to 1,647.

The final Dow Jones Industrial Average close was 12442.16, up 25.56. On the New York Stock Exchange, there were 1,684 issues advancing, 1,647 declining and 128 unchanged.

NYSE volume totaled 1,615,612,010 shares, compared with 1,765,976,450 Tuesday.

The NYSE Composite Index was 9003.12, down 20.78. The average price per share fell by 37 cents.

Las Vegas Sands leapt 10.43, or 11%, to 102.81, and Wynn Resorts (Nasdaq) rose 3.35, or 3.4%, to 102.45, both all-time closing highs. The casino operators advanced on analysts’ reports showing healthy gambling revenue and strong market share in Macau, China. Las Vegas Sands was also said to have received official government permission to build a resort on a neighboring Chinese island.

Ceradyne (Nasdaq) lost 3.79, or 6.1%, to 57.96. Friedman Billings Ramsey lowered its rating on the shares to underperform from market perform, saying as pressure builds to reduce troop levels in Iraq, delivery rates for the defense product maker’s body armor could gradually begin to slow.

Sears Holdings (Nasdaq) rose 5.86, or 3.5%, to 172.09. The retailer predicted fourth-quarter earnings in a range that, on average, exceeds Wall Street’s expectations, despite sluggish holiday sales at its Sears and Kmart stores and recent losses from trading in risky financial derivatives.

J. Crew Group lost 1.53, or 4.1%, to 36.24. The retailer, which offers its clothing through catalogs and stores, reaffirmed that it expects to report earnings per share for 2006 in the range of 95 cents to 97 cents. Analysts were looking for 98 cents. J. Crew also said it filed a registration statement for the proposed offering of 7.5 million shares of common stock.

US Airways rose 1.03, or 1.8%, to 58.93. The air carrier sweetened its hostile takeover bid for Delta Air Lines by 20% to $10.2 billion from $8.5 billion. Delta has also been having recurring talks with Northwest Airlines about a potential link-up between the two, possibly after they both emerge from bankruptcy-court protection later this year, The Wall Street Journal reported.

International Business Machines dropped 1.18, or 1.2%, to 98.89 after closing over 100 on Tuesday, the first time since the beginning of 2004. A.G. Edwards on Wednesday downgraded the shares to hold from buy, citing the stock’s price and concerns that the computer giant’s long-term sales growth potential is relatively low.

XM Satellite Radio Holdings (Nasdaq) jumped 1.53, or 10%, to 16.65. Citigroup lifted its 12-month price target for shares to $21 from $16, saying that more customers who buy cars and trucks with XM radios are likely to sign up for the service. The investment firm added that the possibility of a merger with rival Sirius Satellite Radio should provide “downside support” for XM stock. Sirius rose 27 cents, or 7.3%, to 3.98 on the Nasdaq.

EBay (Nasdaq) lost 45 cents, or 1.5%, to 29.30. The Internet auctioneer on Wednesday was near a deal to purchase ticket reselling Web site StubHub for potentially more than $300 million, The Wall Street Journal reported.

IntercontinentalExchange rose 10.60, or 8.5%, to 135.25, among the Big Board’s top 10 percentage gainers, and Nymex Holdings advanced 5.81, or 4.9%, to 123.45. Both exchanges posted record crude oil futures volumes Tuesday as prices swung wildly during intraday trading.

ImClone Systems (Nasdaq) gained 1.56, or 5.3%, to 30.78. The biotechnology company said its Erbitux drug, in combination with chemotherapy, improved a measure of survival in a study of people with advanced colorectal cancer.

Eastman Kodak lost 35 cents, or 1.4%, to 25.28. The photo-imaging company, which has been struggling to keep up with changing tastes to digital imaging from film, plans to sell its health group to Onex Corp. in a deal that may be worth as much as $2.55 billion.

NYSE Group gained 3.63, or 3.5%, to 108.21. The parent of the New York Stock Exchange, which reached across the Atlantic in a planned acquisition of exchange operator Euronext, has also set its sights on Asia by taking a 5% stake in the National Stock Exchange of India for about $115 million.

E.W. Scripps gained 1.92, or 3.8%, to 51.92. Goldman Sachs said management indicated the media company may be willing to reduce its exposure to newspapers, and double down its efforts in cable TV and Internet, a development investors would likely respond positively to.

Western Union rose 21 cents, or close to 1%, to 22.46. The state of Arizona has no authority to seize thousands of the company’s money transfers to Mexico that originated outside of Arizona, a state court has ruled.

Ipsco gained 2.37, or 2.7%, to 90.47, and United States Steel rose 64 cents, or nearly 1%, to 70.84. Banc of America Securities said a survey it took showed demand in the steel area is down compared with last year, but expectations over the coming six months are positive, with 62% of respondents seeing increased order activity.

Phillips-Van Heusen lost 27 cents to 52.99. The drop came despite the apparel and neckwear maker saying its fourth-quarter earnings will at least meet its estimate of 43 cents a share.

Choice Hotels gained 1.71, or 4.1%, to 43.41. Bear Stearns raised its rating on the shares to peer perform from underperform, saying at current levels, the stock offers a fair risk-reward, especially given little risk to earnings estimates.

By Karen Talley, Dow Jones Newswires


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