Stocks Climb as Icahn Shines on Apple
NEW YORK ( TheStreet) -- U.S. stocks gained Tuesday as a Federal Reserve official downplayed the possibility the central bank will curb asset purchases in September and billionaire investor Carl Icahn tweeted that he's taken a large position in Apple (AAPL - Get Report).
The S&P 500 rebounded from an early decline to gain 0.3%, closing at 1,694.16.
Apple shares surged 4.8% to $489.57, making it the day's second best percentage gainer on the S&P 500, after Icahn tweeted: "We currently have a large position in APPLE. We believe the company to be extremely undervalued. Spoke to Tim Cook today. More to come." The investor followed with a second tweet that revealed he spoke to the Apple chief executive about the need for a larger buyback in shares.Atlanta Fed President Dennis Lockhart bolstered stocks by saying in a speech that the first adjustments to the central bank's monetary stimulus could proceed in September, October or December though a timeline has yet to be determined. Lockhart said he didn't have enough data to say for certain when tapering might begin. The U.S. Census Bureau reported that July retail sales rose 0.2%, falling short of the average estimate of economists polled by Thomson Reuters, who were expecting sales to increase 0.3% from the prior month. But the report upwardly revised June retail sales to show a 0.6% gain. Ex-autos rose 0.5%, which was slightly better than the 0.4% forecast. Ex-auto and gas rose 0.4%. "I thought it wasn't too far from expectations when you take the net of the headline, the details, the revision: headline was a little worse, details better, revisions mixed," Michael Feroli, chief U.S. economist at JPMorgan, said in a phone interview from New York. "You kind of take it all together and it was, eh, just not that big a deal I didn't think." Elsewhere, JC Penney (JCP - Get Report) shares fell 3.7% to $12.68 after Bill Ackman, CEO of the hedge fund Pershing Square, quit the Plano, Texas-based company's board following more than two years of attempting to force changes at the retailer. JC Penney has lost more than 45% over the past 12 months. During that same period, the S&P 500 has gained more than 20%. Micron Technology (MU - Get Report) was the biggest percentage gainer on the S&P, surging 8.2% to $14.97, after analysts said they expectedthe manufacturer of semiconductors to get a boost from its acquisition of Elpida. Japanese stocks rose overnight after the Bank of Japan released minutes of its latest monetary policy meeting, which left the key interest rate near zero and upwardly revised its economic outlook for growth amid its aggressive monetary stimulus program. Reports of a possible cut in corporate taxes also added a lift to Japanese equities. The Bureau of Labor Statistics reported Tuesday that July import prices rose 0.2%, which was below economists' expectations for a 0.6% bump, but better than the 0.4% June fall. Export prices dipped 0.1%, missing economists expectations of a 0.2% increase. Export prices were unchanged in June. Business inventories for June remained unchanged, according the to Census Bureau. Economists polled by Thomson Reuters were looking for a 0.2% increase. The May period was downwardly revised to a 0.1% dip. Asian markets closed higher overnight. Japan's Nikkei average surged 2.57% to 13,867, as Hong Kong's Hang Seng climbed 1.21% to 22,541. European markets were gaining on Monday. The FTSE 100 in London closed higher by 0.57%, and the DAX in Frankfurt added 0.68% on the back of in-line consumer price index data from the United Kingdom and Germany. The benchmark 10-year U.S. Treasury bond was slumping 27/32, boosting the yield to 2.718%. The dollar was adding 0.31%, according to the
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