Apple's dismal earnings juxtaposed against a marginally
better-than-expected GDP rate left the benchmarks struggling for
definite direction on Friday. Meanwhile, consumer sentiment
touched its highest level in five years. The financial sector was
the major loser among the S&P 500 industry groups for the
APPLE INC (AAPL): Free Stock Analysis Report
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CITIGROUP INC (C): Free Stock Analysis Report
CATERPILLAR INC (CAT): Free Stock Analysis
DU PONT (EI) DE (DD): Free Stock Analysis
EXPEDIA INC (EXPE): Free Stock Analysis
GOLDMAN SACHS (GS): Free Stock Analysis
INTEL CORP (INTC): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis
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The Dow Jones Industrial Average (DJI) rose 0.03% to close the
day at 13,107.21. The Standard & Poor 500 (S&P 500)
slipped 0.1% to finish Friday's trading session at 1,411.94. The
tech-laden Nasdaq Composite Index edged up 0.1% to end at
2,987.95. The fear-gauge CBOE Volatility Index (VIX) dropped 1.7%
to settle at 17.81. Consolidated volumes on the New York Stock
Exchange, American Stock Exchange and Nasdaq were roughly 6.02
billion shares, lower than the year-to-date average of 6.51
billion shares. Declining stocks outpaced the advancers on the
NYSE; as for 56% stocks that declined, 39% stocks moved higher.
For the week, the Dow fell 1.8%, the S&P 500 lost 1.5% and
the Nasdaq slumped 0.6% following dismal earnings from blue-chips
companies and a cautious outlook from heavyweights like
Caterpillar Inc. (NYSE:
), 3M Co (NYSE:
), E I Du Pont De Nemours And Co (NYSE:
) and Intel Corporation (NASDAQ:
). A decline in revenues, especially from large multinationals,
remained the major concern for investors. According to Thomson
Reuters, only 36.9% of S&P 500 companies have reported
revenue above analysts' forecasts. Investors also remained
apprehensive ahead of the U.S. presidential election.
The big news for the day was the increase in real gross domestic
product. Real gross domestic product is the output of goods and
services produced by labor and property located in the United
States. According to the report, the real gross domestic product
expanded 2.0% annually in the third-quarter. This was above
consensus estimates of 1.8%. In the second-quarter, real GDP had
increased 1.3%. However, some market experts opined that the
slightly better-than-expected GDP figure in the third-quarter is
still not good enough to reduce unemployment.
Meanwhile, technology bellwether Apple Inc's (NASDAQ:
) quarterly report disappointed investors. The company reported a
second straight quarter of earnings miss. Apple's earnings were
hurt by lower-than-expected iPad sales. Also, Amazon.com, Inc.
) posted quarterly results, which came in below analysts'
estimates. The company reported a first quarterly net loss in
more than five years.
However, the Technology SPDR (XLK) gained 0.2% following
better-than-expected results from Expedia Inc (NASDAQ:
) and analysts' forecasts that Amazon will do well in the coming
holiday shopping season. Stocks such as Expedia, Intel
Corporation, MIPS Technologies, Inc. (NASDAQ:
), Texas Instruments Incorporated (NASDAQ:
) and Atmel Corporation (NASDAQ:
) surged 15.0%, 1.2%, 1.1%, 2.8% and 1.3, respectively.
Separately, Thomson Reuters/University of Michigan released data
on the consumer sentiment index, which revealed that the consumer
sentiment rose to 82.6 in October from 78.3 in September. The
consumer sentiment index reached its highest level since
September 2007. This was just above consensus estimates of 82.5.
According to market experts, the increase in consumer sentiment
was boosted by a decrease in gasoline prices, improving property
values and a gradual improvement in labor markets.
The Financial Select Sector SPDR lost 0.5% and was the major
loser among the S&P 500 group of companies. Stocks such
as Citigroup Inc. (NYSE:
), Morgan Stanley (NYSE:
), JPMorgan Chase & Co. (NYSE:
), Goldman Sachs Group, Inc. (NYSE:
) and UBS AG (NYSE:
) lost 2.7%, 0.4%, 1.2%, 0.2% and 0.4%, respectively.