BLBG: U.S. Stocks Fluctuate After Dow Surpasses 16,000
U.S. stocks swung between gains and losses after Dow Jones Industrial Average rose 16,000 for the first time.
Boeing Co. (BA) rose 2.9 percent after securing record plane orders on the first day of the Dubai Air Show. Tyson Foods Inc., the largest U.S. meat processor, advanced 3 percent after reporting revenue above analysts’ estimates on a gain in prices and sales volumes for beef and chicken. Microsoft Corp. fell 0.9 percent after Bank of America Corp. cut its rating to underperform from neutral.
The Standard & Poor’s 500 Index slipped 0.1 percent to 1,796.13 at 10:02 a.m. in New York, erasing a 0.2 percent advance. The Dow average added 24 points, or 0.2 percent, to 15,986.16 and earlier reached 16,030.28.
“As we keep going and making new highs, we get into new territory and the air keeps getting thinner and thinner up here,” Tim Hartzell, who helps manage about $425 million as chief investment officer at Sequent Asset Management, said via phone from Houston. “Everybody is watching Yellen and feel comfortable that she’ll continue QE, maybe even put more into the system.”
Private Investment
China’s leaders vowed to allow more private investment in state-controlled industries and expand farmers’ land rights as part of the ruling Communist Party’s biggest package of economic reforms since the 1990s. New York Federal Reserve Bank President William C. Dudley and Philadelphia Fed Bank President Charles Plosser are scheduled to speak today. The Fed’s decision to maintain the pace of stimulus has helped the S&P 500 jump 26 percent this year.
China’s stocks rose today, with the benchmark index for mainland companies in Hong Kong surging the most since December 2011. The Stoxx Europe 600 Index rose 0.5 percent.
“We believe China is on the cusp of a massive multiyear bull run,” Christie Ju, managing director at Jefferies Group LLC in Hong Kong, wrote in a note to clients.
Boeing gained 2.9 percent to $140. The company took an early lead over rival Airbus SAS in the biennial Dubai expo, signing up Etihad Airways PJSC for its new 777X wide-body planes as well as for more 787 Dreamliners.
Tyson climbed 3 percent to $29.62. The company said fiscal fourth-quarter sales rose 7 percent to $8.89 billion, beating the $8.87 billion average of 12 analysts’ estimates compiled by Bloomberg.
Mosaic, Potash
Mosaic Co. rose 0.9 percent to $49.51 and Potash Corp. of Saskatchewan Inc. gained 1.4 percent to $32.85. The producers of the crop nutrient potash advanced after billionaire Mikhail Prokhorov’s Onexim Group agreed to buy Suleiman Kerimov’s stake in OAO Uralkali, bolstering prospects that a standoff over a global marketing venture for potash will be resolved.
The sale may defuse a dispute between Russia and Belarus sparked by Uralkali’s July withdrawal from a partnership that marketed 40 percent of global potash exports.
Microsoft declined 0.9 percent to $37.51. Bank of America analyst Kash Rangan cut the shares to underperform from neutral, citing the risk that the board will select a chief executive officer that disappoints investors.
Nvidia Corp. (NVDA) dropped 2 percent to $15.84. The shares were cut to underweight, or sell, from equalweight, or hold, at Morgan Stanley.
Cheap is converging with expensive in the American equity market, narrowing options for investors looking for bargains after the broadest rally on record lifted almost 90 percent of the S&P 500 this year. A measure of the dispersion of price-earnings ratios in the S&P 500 compiled by Goldman Sachs Group Inc. narrowed to 41 percent in June, the lowest on record, and held around that level since.
To contact the reporters on this story: Alexis Xydias in London at axydias@bloomberg.net; Nick Taborek in New York at ntaborek@bloomberg.net
To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net
