By Dan Strumpf
The Nasdaq Composite Index resumed its march toward record highs
Thursday, boosted by a rebound in Apple Inc. shares, even as other
stock benchmarks inched lower.
The Nasdaq advanced 20.75 points, or 0.4%, to 4987.89, bringing
the technology-laden index within striking distance of 5000 and
1.2% from its record close of 5048.62 last reached 15 years
ago.
The Dow Jones Industrial Average lost 10.15 points, or 0.1%, to
18214.42, pulling back from Wednesday's record close.
The S&P 500 slipped 3.12 points, or 0.15%, to 2110.74.
Trading activity was relatively light, as the fourth-quarter
earnings season drew to a close, and fears over Greece's bailout
continued to recede.
Tom Carter, managing director at JonesTrading, said the absence
of market-moving headlines was prompting some investors to curtail
winning bets.
"They look at their portfolio and there are stocks that have
ripped, that have done nicely," he said. That leads them to think,
"I'm going take some money off the table and I'm going to redeploy
it."
A renewed selloff in oil prices dragged oil and gas stocks
lower. U.S. crude-oil futures lost 5.3% to $48.30 a barrel. Energy
companies posted the sharpest losses within the S&P 500, with
the energy sector index down 1.8%. "You have energy dragging down
the overall index," said Brian Fenske, head of sales trading at
ITG.
The Nasdaq Composite, however, resumed its recent rally. The
index, which has risen for 11 of the last 12 sessions, was
bolstered by a rally in shares of Apple Inc., which gained 1.3%,
rebounding from a prior-day slide.
Also lifting the index was a 15% leap in shares of Avago
Technologies Ltd. after the semiconductor maker said it would buy
Emulex Corp. for $606 million. Emulex jumped 25%.
Despite those gains, major stock benchmarks have moved modestly
in recent weeks, coinciding with a drawdown in trading volumes and
market volatility. The CBOE Volatility Index, or VIX, hovered
around its lowest level since early December, recently edging up to
14 on Thursday.
"Once you come off that cycle of big macro headlines, you sit
around and wait for what's next," said Larry Weiss, head of trading
at Instinet. Stocks "are kind of range bound," he said.
The S&P 500 is up 2.5% this year, on the heels of an 11%
climb last year. Scott Armiger, chief investment officer at
Christiana Trust, which oversees about $9 billion, said the firm
has benefited from bets on shares of health care companies and
consumer discretionary stocks. But stocks' march higher has him
concerned that valuations have become too lofty.
"Stocks are rich," Mr. Armiger said. "We're not getting excited
about any sector now. We're just kind of hanging out."
European stocks closed higher as the European Central Bank
prepares to launch its bond-buying program. Germany's DAX rose 1%
to a record close and France's CAC 40 added 0.6% and finished at
its highest since June 2008.
In economic news, the consumer-price index fell 0.7% in January
from December, the Labor Department said. Prices slipped 0.1% from
a year earlier, marking the first year-over-year decline since
October 2009.
In other markets, gold futures rose 0.7% to $1209.60 an ounce.
Treasury prices fell, lifting the 10-year yield to 2.016% from
1.968% on Wednesday.
Morgan Stanley agreed to pay $2.6 billion to settle U.S. claims
linked to the sale of mortgage bonds. Its shares fell 1.5%.
Bank of America Corp. agreed to pay a group lenders to the
failed Fontainebleau Las Vegas $300 million to settle allegations
it improperly advanced funds to the casino project as its finances
deteriorated. Its shares fell 2.7%.
Salesforce.com Inc. posted a 26% jump in quarterly revenue from
a year ago, driven in part by international sales. The company's
shares advanced 12%.
Write to Dan Strumpf at daniel.strumpf@wsj.com
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