Rare miss by Apple pushes Nasdaq lower

THE S&P 500 fell for a fourth day and the Nasdaq dropped yesterday after a rare earnings stumble from Apple, while strong results from Boeing and Caterpillar lifted the Dow.

Apple, the most valuable US company by market capitalisation, reported sales late on Tuesday that fell short of Wall Street’s expectations as the European economy sagged and consumers held off buying iPhones before a new version expected in the autumn.
Shares fell 4.3 per cent to $574.97. Without Apple’s losses, the S&P would have ended higher.

The price-weighted Dow industrials managed gains thanks to Caterpillar and Boeing. Caterpillar rose 1.4 pe rcent to $82.60 after its quarterly profit easily beat Wall Street’s expectations.

Hope that the Federal Reserve will act soon to provide more stimulus to the economy also supported stocks. A report in The Wall Street Journal on Tuesday said Fed officials may be moving clos er to taking more steps to aid the flagging economy.

Because of those expectations “bank stocks are performing relatively well,” said Thomas Villalta, portfolio manager for Jones Villalta Asset Management in Austin, Texas.

The Dow Jones industrial average rose 58.73 points, or 0.47 per cent, at 12,676.05. The Standard & Poor’s 500 Index was down 0.42 point, or 0.03 percent, at 1,337.89. The Nasdaq Composite Index was down 8.75 points, or 0.31 per cent, at 2,854.24.

Boeing also helped the Dow when it reported a larger-than-expected increase in second-quarter profit and raised its full-year earnings.