by Marc Bastow | July 24, 2013 5:04 pm
New home sales hit a five-year high and Europe’s PMI jumped over 50, providing some optimism for eurozone, but it still wasn’t enough to push all the major markets forward. A broad sell-off killed hopes of another Dow record and stopped the S&P 500 cold.
Indeed, the S&P 500, which lost 0.38% to close at 1685.94, suffered its first two-day losing streak since late June. The Dow Jones Industrial Average bounced off Tuesday’s record high to close down 0.16% at 15542.24. The bright spot on the day was the Nasdaq, which rose fractionally to 3579.60 on a strong performance in the tech sector.
Earnings news topped headlines as a suddenly resurgent Apple (AAPL) soared ahead over 5% following its after-hours report on Tuesday. The tech giant beat estimates and sold a record number of iPhones. The rise overshadowed a similar 5% move by EMC (EMC) who reported earnings in line with analyst estimates, helped by a strong performance at VMware (VMW), which is majority owned by EMC. VMW jumped up over 16%.
Tech’s good news continued after hours, as Facebook (FB) shares shot up nearly 20% — crossing the $30 per share mark — after announcing revenue jumped 53% year-over-year in the second quarter. Mobile ads rose to 41% of total ad revenue, up from 30% in the first quarter.
The aerospace and defense sector followed Tuesday’s solid results from Lockheed Martin (LMT) with a General Dynamics (GD) earnings beat. Northrop Grumman (NOC) also topped estimates and upped its earnings and revenue estimates for the full year. Both were up just under 2% for the day.
Not so fortunate was Caterpillar (CAT) which saw shares plummet after announcing its second quarter profits dropped 43% compared to last year. Its EPS of $1.45 per share was well behind analyst estimates of $1.70. CAT fell over 2% to register the largest loss on the Dow.
Joining CAT on the slide were Joy Global (JOY), which sank over 3%, Terex (TEX) which lost over 2%, Deere (DE) and Cummins (CMI), which both fell over 1%.
Beverage-maker Dr. Pepper Snapple (DPS) announced that both top and bottom line figures fell year-over-year in Q2 while missing analyst estimates. The market sent its shares down nearly 3%. PepsiCo (PEP), on the other hand, reported a 35% rise in year-over-year second quarter earnings, beating estimates and hitting revenue targets. Investors were unimpressed and the stock ended down just under 1%.
Finally, Dell (DELL) shareholders got a boost when founder Michael Dell and his Silver Lake Partners upped their bid for the company by 10 cents per share to $13.75 and postponed the voting until Aug. 2. Shares closed at $12.91. I guess the best thing to say: Stay tuned.
Earnings reports on the calendar for Thursday include Amazon (AMZN), General Motors (GM), and Starbucks (SBUX).
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he is long AAPL.
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