Dow snaps winning streak
Intel's improved sales forecast and Dell's profit surprise encourage tech investors, but stocks struggle one day after the Dow, S&P 500 and Nasdaq hit fresh 2009 highs.
NEW YORK (CNNMoney.com) -- Stocks seesawed Friday as investors welcomed corporate news from Intel and Dell that signaled a bottom in the PC market, but mostly played it cautious after pushing the markets to 2009 highs in the previous session.
The Dow Jones industrial average (INDU) lost 36 points, or 0.4%. The S&P 500 (SPX) index lost 2 points or 0.2%. The Nasdaq composite (COMP) rose 1 point, or 0.1% and managed to squeak out a fresh 2009 high, closing at the highest point since Oct. 1.
All three major indexes had gained in the morning, thanks to the tech boost, but lost steam as the session wore on. Trading volume was light on the second-to-last trading session of August.
Stocks managed slim gains Thursday, with the Dow stretching its winning streak to eight straight sessions, its longest run since the period ended April 10, 2007.
But the gains have been tepid this week on the back of a surprisingly strong summer advance.
Between the March 9 lows and Friday's close, the S&P 500 gained 52%.
Intel and Dell: Chipmaker Intel (INTC, Fortune 500) boosted its revenue forecast for the third quarter, thanks to stronger PC demand, saying it expects sales of $8.8 billion to $9.2 billion. Previously, it forecast sales of $8.1 billion to $8.9 billion. Analysts surveyed by Thomson Reuters are currently forecasting sales of $8.55 billion.
Although many companies reported better-than-expected earnings in the second quarter, revenue growth has been tepid with results mostly driven by cost-cutting. Intel, a Dow component, rallied 4%.
Economy: Personal income was essentially flat in July, the government reported, versus forecasts for a rise of 0.1%. Income declined 1.1% in June.
But spending perked up, thanks to the government's Cash for Clunkers program. Personal spending rose 0.2% after falling 1.1% in June. The rise was in line with estimates.
Consumer sentiment was revised up to 65.7 in August from an earlier reading of 63.2. Economists expected a reading of 64. In July, sentiment stood at 66.
Company news: Apple (AAPL, Fortune 500) has signed a multiyear deal with China Unicom to bring the iPhone to China, the world's largest cellphone market. The deal ends months of speculation as to which Chinese firm would enable Apple's expansion into the lucrative market. Shares were little changed.
Oil: U.S. light crude oil for October delivery rose 25 cents to settle at $72.74 a barrel on the New York Mercantile Exchange.
World markets: European markets ended higher, while Asian markets ended mixed.
Bonds: Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.43% from 3.44% late Thursday. Treasury prices and yields move in opposite directions.
Treasury sold $109 billion in debt this week to moderate demand.
Other markets: COMEX gold for December delivery rose $11.50 to settle at $958.80 an ounce.
In currency trading, the dollar fell versus the euro and gained against the Japanese yen.
Market breadth was mixed. On the New York Stock Exchange, winners narrowly beat losers on volume of 1.19 billion shares. On the Nasdaq, decliners topped advancers eight to five on volume of 2.38 billion shares.
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