S&P 500 ends flat as bank profits temper growth concerns

JPMorgan, Goldman Sachs earnings jump; Apple shares climb after three-day slide
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First Published: Thu, Jan 17 2013. 09 22 AM IST
The Dow Jones industrial average was down 23.66 points, or 0.17%, at 13,511.23. The Standard & Poor’s 500 Index was up 0.29 points, or 0.02%, at 1,472.63. Photo: AFP
The Dow Jones industrial average was down 23.66 points, or 0.17%, at 13,511.23. The Standard & Poor’s 500 Index was up 0.29 points, or 0.02%, at 1,472.63. Photo: AFP
New York: The S&P 500 ended nearly flat on Wednesday as solid earnings from two major banks and a bounceback in Apple shares offset concerns about a lower forecast for global growth in 2013.
Shares of Goldman Sachs hit their highest since May 2011 as earnings nearly tripled on increased revenue from dealmaking and lower compensation expenses. JPMorgan Chase said fourth-quarter net income jumped 53% and earnings for 2012 set a record.
JPMorgan shares rose 1% to $46.82, while Goldman climbed 4.1% to $141.09.
They were among the first big banks to report results and helped to lift estimates for S&P 500 corporate earnings slightly, to a 2.2% gain, Thomson Reuters data showed.
“Pretty solid numbers from both JPMorgan and Goldman Sachs are putting a lot of momentum behind the financials, with a lot more names to report this week. But I think that’s helping to put a better bid to the market overall,” said Michael James, senior trader at Wedbush Morgan in Los Angeles.
Apple rebounded after three days of losses, helping the Nasdaq outperform the S&P 500 and Dow. Apple Inc. rose 4.2% to $506.09. It closed below $500 on Tuesday for the first time since February.
“There could not have been more negativity around Apple going into today. So was it due for an oversold bounce on a trading basis? Absolutely,” James said.
A slow economic recovery in developed nations is holding back the global economy, the World Bank said on Tuesday, as it sharply scaled back its forecast for world growth in 2013 to 2.4% from an earlier forecast of 3%.
The Dow Jones industrial average was down 23.66 points, or 0.17%, at 13,511.23. The Standard & Poor’s 500 Index was up 0.29 points, or 0.02%, at 1,472.63. The Nasdaq Composite Index was up 6.77 points, or 0.22%, at 3,117.54.
The biggest drag on the Dow was Boeing Co., whose shares fell 3.4% to $74.34 on concerns about its new Dreamliner passenger jets. Japan’s two leading airlines grounded their fleets of 787s after an emergency landing, adding to safety concerns triggered by a series of recent incidents.
After the bell, shares of eBay were trading up 0.7% at $53.28, reversing an initial decline following the release of its results. Also after the close, shares of CBS rose 8.3% to $41.10 after it said it will convert its Outdoor Americas division into a real estate investment trust.
Earlier in the day, US economic data showed consumer prices were flat in December, pointing to muted inflation pressures that should give the Federal Reserve room to prop up the economy by staying on its ultra-easy monetary policy path.
Other data showed US homebuilder confidence in the market for single family homes held steady near seven year highs in January, suggesting the outlook for the housing market remained upbeat.
Volume was roughly 5.6 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.
Decliners outpaced advancers on the NYSE by nearly 8 to 7 and on the Nasdaq by almost 7 to 5.
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First Published: Thu, Jan 17 2013. 09 22 AM IST
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