Markets Diverge as Apple Gets Hammered
NEW YORK ( TheStreet) -- Major U.S. stocks indices headed in different directions Wednesday as investor disappointment in Apple's (AAPL - Get Report) latest iPhone dampened the Nasdaq while gains by IBM (IBM - Get Report) boosted the Dow Jones Industrial Average.
The tech-heavy Nasdaq dropped 0.11% to 3,725.01 as Apple shares plummeted 5.4% to $467.83.
Tech companies were boosting the blue-chip index as Microsoft (MSFT - Get Report) added 1.1% to $32.75 and United Technologies (UTX) added 1.5% to $107.83. But IBM was the top Dow gainer as shares surged 2.2% to $190.70 after the company known as Big Blue said it will sell its customer-care outsourcing business to Synnex Corp. (SNX) for $505 million. Synnex was popped 20.1% to $57.59.Apple (AAPL - Get Report)'s decline came a day after the iPhone maker presented two new iPhones that failed to excite investors. One is the iPhone 5C, a unit to be priced as low as $99, while the second unit, the iPhone 5S is an upgrade that adds "Touch ID," a fingerprint sensor built into the home button. Overnight, Apple gained a license from China Mobile to begin launching iPhones for the first time on the Asian nation's largest wireless network. Credit Suisse on Wednesday downgraded Apple to "Neutral" from "Outperform" as analyst Kulbinder Garcha but his 12-month target price to $525 a share. Apple was the worst performer in the S&P 500. In economic news, the U.S. Census Bureau reported Wednesday that wholesale inventories for July rose 0.1%, which was a boost from the June reading of a 0.2% drop, but missed expectations among economists polled by Thomson Reuters who were expecting July inventories to have risen 0.3%.
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