Stocks rise slightly; Apple up on dividend announcement
NEW YORK (AP) — U.S. stocks drifted higher Monday but lost the momentum from their biggest week of the year. A dividend from Apple, a deal for UPS and the promise of greater demand for U.S. Steel drove those stocks to gains.
The Dow Jones industrial average spent most of the morning in the red, then climbed to a gain shortly before noon. By mid-afternoon, it was up 15 points to 13,247, a ho-hum performance compared with its 310-point gain last week.
The Standard & Poor’s 500 was up nine points to 1,413, and the Nasdaq composite index was up 30 points to 3,085.
Though ever-present concerns about European debt, a slowdown in China and the pace of U.S. economic growth may be bubbling below the surface, investors seemed to take a day off from worrying about them.
“The absence of any negative news over the weekend was pretty positive,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Va., who described the market as complacent. “It sounds backward, but that’s quite often the case.”
The Dow’s 2.4 percent rise last week was matched by the S&P 500 in the best showing of the year for both. Last Tuesday, for the first time, the Dow closed above 13,000 and the Nasdaq above 3,000 on the same day.
But on Monday, in the absence of major economic news, moves by a handful of companies steered the markets.
Apple rose about 2 percent to about $599 after announcing that it would pay a shareholder dividend and buy back $10 billion of its stock over three years. The stock hit an all-time high of $600.01 last week.
The dividend is expected to expand the company’s shareholder reach because value-oriented mutual funds that focus on dividends will buy it. Apple’s stock already has risen from $405 this year, partly in anticipation of the dividend.
UPS rose 4 percent after announcing it would buy TNT Express, the second-largest express mail company in Europe behind DHL. The purchase further solidifies UPS‘ status as the world’s largest delivery company.
U.S. Steel climbed 7 percent, the best performer in the S&P 500, after some manufacturers announced price increases last week, fueling expectations of improving demand. Steel Dynamics and AK Steel Holding Corp. also rose.
There was little in the way of major economic indicators. The National Association of Home Builders index of builder confidence came in unchanged from the previous month but is at its highest since June 2007, a year before the financial crisis.
“There’s not really a lot to say,” said Stephen Carl, head equity trader at Williams Capital Group. “I guess we could just toss a coin in the air and see which way it goes.”
Prices for U.S. Treasury debt slid for the ninth day in a row, and the yield on the 10-year Treasury note hit 2.39 percent, the highest since October. Investors feeling more confident in the economy are putting their money in riskier assets such as stocks.
European markets were mixed. The main stock indexes fell less than 1 percent in France, Britain and Germany. Stocks rose 1.6 percent in Greece and 1.2 percent in Spain.