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Stocks zigzag as companies post mixed results

July 23, 2009|Times Wire Services

NEW YORK — Stocks finished mixed Wednesday after another session of earnings-driven trading. The Nasdaq composite index rose for the 11th straight session, but the Dow industrials and the Standard & Poor's 500 index slipped.

Apple rose 3.5% after the company late Tuesday reported that robust sales of laptops and iPhones pushed its profit and revenue above analysts' estimates.

Starbucks surged 18%. The coffee chain also topped Wall Street expectations in posting earnings boosted by moves to shut stores, lay off workers and cut other costs.

But Advanced Micro Devices reported a wider-than-anticipated second-quarter loss, sending shares of the second-largest computer chip maker down 13%.

Wells Fargo joined other banks in reporting that losses from bad loans kept rising although its second-quarter earnings rose 81%. Its stock fell 3.6%.

A gauge of banks in the S&P 500 fell 0.7%.

The Dow Jones industrial average slumped 34.68 points, or 0.4%, to 8,881.26, ending a seven-session winning streak.

The broader S&P 500 slipped 0.51 of a point, or 0.1%, to 954.07, and the Nasdaq rose 10.18 points, or 0.5%, to 1,926.38, helped by Apple and Starbucks.

The Nasdaq's 11-day winning streak is its longest since 1996.

The Russell 2,000 index of smaller companies rose 0.7%.

Advancing stocks outpaced decliners by 4 to 3 on the New York Stock Exchange.

In the eight sessions since the unofficial start of earnings season, the Dow remains up 8.8%, the S&P is up 8.3% and the Nasdaq is up 10%.

Per-share earnings beat analysts' projections by an average of 11% for the 105 companies in the S&P 500 that have reported results for the June quarter, according to data compiled by Bloomberg.

Home builder stocks climbed after the Federal Housing Finance Agency said home prices increased 0.9% in May from April. Economists had expected a 0.2% drop. Lennar shot up 7.7%, while KB Home gained 6.4%.

Oil prices fell for the first time in six days after a government report showed a smaller-than-forecast decrease in inventories.

Crude futures dropped 21 cents to settle at $65.40 a barrel on the New York Mercantile Exchange.

An index of energy stocks in the S&P 500 slid 1%, the most of 10 broad industry groups.

Treasury yields rose. The benchmark 10-year Treasury note climbed to 3.55% from 3.47% late Tuesday.

In other market highlights:

* Genzyme sank 8.4% after the biotech company lowered its year-end earnings forecast because of a plant closure that restricted drug supplies.

* VF climbed 2.2%. The world's largest apparel maker said cost cutting contributed to a second-quarter profit that exceeded some analysts' estimates.

* Morgan Stanley advised investors to sell into the global advance in equities, saying cyclical growth risks had diminished but not disappeared.

* Overseas, key stock indexes rose 0.3% in Britain, 0.5% in Germany, 0.1% in France and 0.7% in Japan.

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