Wall Street little changed; Intel drags, Morgan Stanley up
US stocks opened little changed on Friday, a day after the S&P 500 rose to its highest level in five years, as a weak outlook from Intel offset a fourth-quarter profit at Morgan Stanley.
Shares in Intel Corp slumped 6.1 per cent to $21.30 after the tech company forecast quarterly revenue that was below analysts' estimates and hiked capital spending plans for the year.
That was offset somewhat by a 5-percent gain in shares of Morgan Stanley, which reported a fourth-quarter profit after a year-earlier loss, helped by higher revenue at the bank's institutional securities business. Its stock jumped 5.3 per cent to $22.84.
The earnings season so far has been mixed, but that could change with a barrage of releases scheduled for next week, said Doug Cote, chief market strategist, ING Investment Management in New York.
"There were some good reports but the real big bellwether companies are not coming in strong," said Mr Cote.
The Dow Jones industrial average edged up 8.02 points, or 0.06 per cent, at 13,604.04. The Standard & Poor's 500 Index slipped 1.20 points, or 0.08 per cent, to 1,479.74. The Nasdaq Composite Index lost 7.52 points, or 0.24 per cent, to 3,128.48.
Overall, S&P 500 company earnings are expected to have risen 2.3 per cent in the fourth quarter, Thomson Reuters data showed. Expectations for the quarter have dropped considerably since October, when a 9.9 per cent gain was estimated.
On Thursday, the S&P 500 rose to its highest since late 2007, and that could prompt investors to lock in recent gains, analysts said.
Economic data out of China provided some support to the market, though the focus remained on U.S. corporate earnings. The country's economy grew at a modestly faster-than-expected 7.9 per cent in the fourth quarter, the latest sign the world's second-biggest economy was pulling out of a post-global financial crisis slowdown which saw it grow in 2012 at its weakest pace since 1999.
General Electric reported a better-than-expected rise in earnings on Friday, spurred by robust demand in China and oil-producing countries. Shares were up 2.4 per cent to $21.82.
Despite the gains in Morgan Stanley, financial stocks sagged as Capital One Financial reported disappointing profit. Capital One slumped 7.4 per cent to $57.06, while the KBW Bank Index slipped 0.4 per cent.
Research In Motion climbed 4.7 per cent to $15.61 after Jefferies Group boosted the BlackBerry maker's rating and price target.
Copyright @ Thomson Reuters 2013
