Stocks Finish Mixed as Apple Weighs


NEW YORK ( TheStreet) -- U.S. stocks finished mixed Wednesday as investors reacted to another round of spotty earnings reports and disappointing new home sales data.

Growing chatter about the prospect of more monetary stimulus from the Federal Reserve provided some support for equities. According to The Wall Street Journal, voices in favor of taking action are getting louder ahead of the central bank's policy meeting next week. Gold, which is generally seen as benefiting from additional quantitative easing, jumped more than $30 to soar above $1600 an ounce.

Selling pressure on Apple was a big headwind to overcome though as the stock lost more than 4% after the company's surprise earnings miss.

The Dow Jones Industrial Average advanced nearly 59 points, or 0.47%, to settle at 12,676. The blue-chip index, which ranged from 12,617 to 12,732 on the day, snapped a streak of three consecutive triple-digit declines.

Nineteen of the Dow's 30 components finished with gains, led by Boeing ( BA), Cisco ( CSCO), AT&T ( T) and Caterpillar ( CAT). Both Boeing and Caterpillar were lifted by solid quarterly reports.

Hewlett-Packard ( HPQ), Microsoft ( MSFT) and Kraft Foods ( KFT) were the biggest blue-chip losers.

The S&P 500 was down fractionally, closing at 1338. The Nasdaq lost nearly 9 points, or 0.31%, to close at 2854.

The weakest sectors in the broad market were technology, consumer cyclicals and utilities. The health care, conglomerates and basic materials sectors were areas of strength.

The latest piece of soft data came from the housing market, which has been the one bright spot in the economy over the past few months. The Commerce Department said new home sales fell 8.4% in June to seasonally adjusted annual rate of 350,000, from May's upwardly-revised rate of 382,000. Economist surveyed by Thomson Reuters expected sales to rise to seasonally adjusted annual rate of 370,000.

"Admittedly, new home sales are a much smaller portion of the housing market, but the decline is coincident with the broader weakening of economic activity observed into the summer," said Dan Greenhaus, chief global strategist at BTIG. "Importantly, there was a very steep drop in sales of new homes in the northeast, falling to the lowest level we believe on record."

"While a housing recovery is underway, it is most certainly not 'all good.' Fits and starts are to be expected and clearly this summer is one of the 'fits,'" Greenhaus said.

Across the pond, the U.K. reported second-quarter gross domestic product that saw the largest quarterly contraction since the first quarter of 2009, and the Ifo Institute's German business confidence index declined for July.

The FTSE in London finished flat and the DAX in Germany closed up 0.25%.

September crude oil futures rose 47 cents to settle at $88.97 a barrel. August gold futures soared $31.90 to settle at $1608.10.

The benchmark 10-year Treasury was down 2/32, raising the yield to 1.398%, while the greenback was sliding by 0.50%, according to the dollar index.

In other corporate earnings news, automaker Ford ( F) posted near-record profit in North America but showed declines in every other area of the world and missed second-quarter analysts' estimates. Shares ticked 9 cents lower to close at $8.97.

RadioShack ( RSH) missed expectations and posted a second-quarter loss as sales slid and gross margins fell. The company also suspended its dividend payments. The stock dropped 29%.

Shares of Riverbed Technology ( RVBD) jumped 26% after the network gear provider provided a better-than-expected third quarter guidance.

Buffalo Wild Wings ( BWLD) missed with its second-quarter results as it continues to struggle against high chicken wing prices. The stock lost nearly 11%.

Netflix ( NFLX) was also a big mover to the downside in Wednesday's trading after streaming movie and DVD-by-mail company beat the consensus but gave a mixed and rather confusing outlook, forecasting a potential loss in the third quarter and more red ink in the fourth quarter as it continues its international expansion. The stock dropped 25% on nearly five times its normal volume.


-- Written by Andrea Tse in New York.

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