By Polya Lesova, MarketWatch
NEW YORK (MarketWatch) -- Gains for Apple Inc. helped the
S&P 500 index nearly erase losses on Friday afternoon,
offsetting disappointment over weaker-than-expected first-quarter
economic growth in the U.S.
The S&P 500 index (SPX) was nearly unchanged at 1,585.11 in
afternoon trade after hitting an intraday low of 1,577.53.
The benchmark is on track for weekly gains of 1.9%.
The technology sector was the top gainer among the S&P's 10
major industry groups, while materials was the worst performing
sector. Read a story on 14 cheap dividend stocks.
Shares of iPhone maker Apple (AAPL) rallied 2.3%, putting it on
track for weekly gains of 7%.
The technology-heavy Nasdaq Composite index (RIXF) also pared
losses to trade down 0.1% at 3,285.19.
"What's happening today is a little bit of jitters on the
economic front and a little bit of jitters on the earnings front,"
said Adam Sarhan, chief executive of Sarhan Capital. Investors are
also growing more concerned over a steeper-than-expected downturn
in Europe given recent data, he said.
More than 411 million shares traded on the New York Stock
Exchange by 3:25 p.m. Eastern. Composite volume topped 2.4
billion.
The Dow Jones Industrial Average (DJI) rose 33.29 points to
14,733, with Hewlett-Packard Co. (HPQ) up 2.7%, leading gainers in
the 30-stock blue-chip index.
Chevron Corp.(CVX) was another gainer in the Dow, rising 1.5%.
The oil major said its first-quarter earnings fell to $6.2 billion,
or $3.18 per share, from $6.5 billion, or $3.27 a share, in the
same period a year ago, but the results still exceeded analyst
expectations.
3M Co. (MMM) and United Technologies Corp. (UTX) were the
biggest decliners in the Dow, dropping 0.9%.
The Commerce Department said before the opening bell that gross
domestic product grew at a 2.5% pace in the first three months of
2013, up from 0.4% in the fourth quarter. Economists surveyed by
MarketWatch had forecast GDP growth of 3.2%. See: Breaking down the
GDP report in charts.
"The disappointment will push back expectations of when the Fed
will start to withdraw its stimulus, especially as recent data
suggest the rate of growth could weaken again in the second
quarter," said Chris Williamson, chief economist at Markit,
referring to the Federal Reserve's bond-buying program, which is
aimed at boosting economic growth and lowering unemployment. The
Federal Open Market Committee is due to hold a meeting on monetary
policy on Tuesday and Wednesday, and it's expected to keep its bond
buying unchanged at $85 billion a month.
Shortly after Friday's opening bell, the University of
Michigan-Thomson Reuters consumer-sentiment gauge fell to a final
April reading of 76.4, the lowest since January, from a final March
reading of 78.6. Economists had expected it to be even lower.
Among individual stock moves, PerkinElmer Inc. (PKI) was the top
decliner in the S&P 500, dropping nearly 13% after the maker of
health-testing equipment lowered its full-year outlook.
Expedia Inc. shares (EXPE) slumped 9.5% after the online travel
site said its first-quarter loss widened. Read about Expedia and
other stocks making big moves in Friday trading.
Shares of Amazon.com Inc.(AMZN) fell 6.6% as the e-commerce
group said late Thursday it may report a second-quarter operating
loss.
J.C. Penney Co.(JCP) rallied 13%, making it the top gainer in
the S&P 500 after hedge-fund investor George Soros reported a
7.9% stake in the struggling retailer.
D.R. Horton Inc.(DHI) shares jumped nearly 9% after the company
posted a surge in fiscal second-quarter profit and a 34% rise in
orders.
Sarhan Capital's Sarhan noted that 70% of companies that have
reported so far have beaten expectations, and earnings are on track
to come in 1.1% lower versus the first quarter of 2012.
"If that happens, it'll be the first annual decline on a
year-on-year basis since 2009," he said.
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