While you were sleeping: Apple takes a break

Published: Wed 22 Aug 2012 07:33 AM
While you were sleeping: Apple takes a break
August 22 (BusinessDesk) – Wall Street gave up early gains as a decline in Apple shares weighed on the overall market and the Standard & Poor's 500 Index took a breather from a four-year high.
Shares of Apple fell, last 1.3 percent weaker, following yesterday's climb to a record that also lifted the company's market capitalisation to the highest in history.
In late afternoon trading in New York, the Dow Jones Industrial Average fell 0.29 percent, the Standard & Poor's 500 Index slipped 0.15 percent, while the Nasdaq Composite Index fell 0.17 percent.
Earlier in the day, the S 500 climbed as high as 1,426.68, its highest since May 2008. And some expect further strength ahead.
"I am looking for new highs in the major indexes," Wayne Kaufman, chief market analyst at John Thomas Financial in New York, told Reuters. "Overall there is no one major negative that's out there right now that people are scared of."
In Europe, the Stoxx 600 Index ended the day with a 0.4 percent advance from the previous close. Stocks also gained in Germany, France and the UK.
Investors are betting the European Central Bank will take action to help lower borrowing costs for struggling euro-zone members notably Spain and Italy.
"The market has moved to the belief that [the ECB] is going to do whatever it takes," William Larkin, fixed income portfolio manager at Cabot Money Management in Salem, Massachusetts, told Reuters.
And those expectations helped push Spain's yields lower at today's auction of 12- and 18-month securities. The yield for bills maturing next August fell to 3.07 percent from 3.92 percent at a sale on July 17, according to Bloomberg News. The yield for the notes maturing in February 2014 dropped to 3.34 percent from 4.24 percent.
The euro also benefited, strengthening to its highest level since early July against both the greenback and the Japanese yen. The euro, at US$1.2469, had earlier climbed as high as US$1.2488, the strongest since July 5, and had reached 99.18 yen, the highest level since July 6.
“The euro continues to be buoyed by investors’ selectively optimistic reading of official statements supporting bailout packages and the periphery,” Noel Hebert, chief investment officer at Bethlehem, Pennsylvania-based Concannon Wealth Management, told Bloomberg. “We’re still in this revolving door of crisis cycle with nothing getting resolved.”
The UK, meanwhile, unexpectedly reported a budget deficit in July, underpinning the dire straits of the economy which has contracted for three consecutive quarters.
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