June 30 (Bloomberg) -- The Standard & Poor's 500 Index was little changed amid heightened concern that losses from loans to the riskiest borrowers will mount, while the Dow Jones Industrial Average gained, capping its biggest quarterly advance since 2003.
Bear Stearns Cos., Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. led financial firms to the second- steepest retreat among 10 industries in the S&P 500. Bear Stearns this week said it would spend $1.6 billion to bail out two hedge funds that made bad bets on bonds backed by subprime mortgages.
``The issue with subprime could be far-reaching,'' said John Davidson, who helps oversee more than $11 billion as president of PartnerRe Asset Management in Greenwich, Connecticut. ``The week has been focused on what's going on at Bear Stearns. The thought was that this could affect the housing market, the consumer and the overall economy.''
Shares of AT&T Inc., the largest U.S. telephone company, rose every day this week, before sales of Apple Inc.'s iPhone began yesterday. AT&T is the mobile device's service provider. General Motors Corp. surged, giving it the Dow's No. 2 gain behind AT&T, after Goldman Sachs Group Inc. advised buying the stock.
The S&P 500 added 0.79, or less than 0.1 percent, to 1503.35. Yesterday's decline prevented the index from posting the biggest quarterly gain since 2003.
The Dow average increased 48.36, or 0.4 percent, to 13,408.62. Its 8.5 percent advance in the second quarter was the most since the final three months of 2003. The Nasdaq Composite Index rose 14.27, or 0.6 percent, to 2603.23.
`Favorable Direction'
U.S. Treasuries advanced following a government report that showed a gauge of inflation watched by the Federal Reserve slowed and concern over acts of terrorism in London. That sent the yield on benchmark 10-year notes down 0.10 percentage point to 5.03 percent, the biggest decrease since the week ended March 2, according to bond broker Cantor Fitzgerald LP.
Reports yesterday showed Americans spent less than forecast in May and the Fed's preferred inflation gauge cooled, signs that a consumer slowdown is restraining price pressures.
``The inflation trend is heading in a favorable direction,'' said Marshall Front, who helps manage about $800 million at Front Barnett Associates in Chicago.
Financial firms in the S&P 500 lost 0.8 percent. The group extended the prior week's 2.9 percent slump, which was the steepest weekly loss since March. Bear Stearns slipped 2.6 percent to $140. Goldman fell 2.5 percent to $216.75. Lehman retreated 1.1 percent to $75.80.
IPhone
AT&T had its biggest weekly gain since July 2006, surging 6.8 percent to $41.50. Apple Chief Executive Officer Steve Jobs has set a goal of selling 10 million iPhones in 2008, giving the company a 1 percent share of the mobile-phone market. Reviewers for the Wall Street Journal, New York Times and USA Today this week praised the software and design of Apple's phone, iPod media player and Internet device.
Apple shares slipped 0.8 percent to $122.04.
Shares of GM, the biggest U.S. automaker, added 6.6 percent to $37.80. Goldman Sachs gave the stock a ``buy'' rating. Also, United Auto Workers members at Delphi Corp. approved an agreement with the bankrupt auto-parts maker that settles a two-year dispute by exchanging pay cuts for employee buyout incentives. Delphi is GM's largest parts supplier.
Research In Motion, Apollo Group
Research In Motion Ltd. shares gained 17 percent to $199.99, including the biggest one-day gain in 3 1/2 years, after the maker of the BlackBerry e-mail phone reported first-quarter profit that topped analysts' estimates. The company's profit soared last quarter while rival Palm Inc.'s earnings fell, underscoring the gap between the two companies as they prepare for new competition from the iPhone.
Apollo Group Inc. surged the most among S&P 500 members, jumping 19 percent to $58.43. The education company reported higher profit than analysts estimated in a Bloomberg survey and said it plans to buy back as much as $500 million in stock.
Nike Inc. rose 10 percent to $58.29, including the biggest one-day rise in 4 1/2 years. The world's largest sneaker maker said orders for clothing and shoes rose the most since 1997. The company capitalized on increased demand in Europe and Asia. Rising incomes and sporting events such as the 2008 Olympic Games ignited consumer spending on footwear and clothes in China.
Commerce Bancorp Inc. advanced 12 percent to $36.99, the No. 2 gain in the S&P 500. New Jersey's biggest bank abruptly replaced founder Vernon Hill as chief executive officer after regulators forced the company to stop doing business with firms controlled by his family.
No comments:
Post a Comment