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US STOCKS-Nasdaq up on Apple, Starbucks; eBay jumps late

Published 07/22/2009, 05:53 PM
Updated 07/22/2009, 05:56 PM
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* Apple, Starbucks lift Nasdaq on solid profits

* Bank results spur some caution; home builders soar

* Dow off 0.4 pct; S&P 500 off 0.1 pct; Nasdaq up 0.5 pct

* Nasdaq up 22 percent for the year (Adds eBay posting results after-hours and volume figures)

By Ellis Mnyandu

NEW YORK, July 22 (Reuters) - The Nasdaq rose on Wednesday for the 11th straight day, buoyed by solid profits from Apple Inc and Starbucks Corp, while disappointing bank results and declining energy shares weighed on the broader market.

The Dow Jones industrial average declined, halting a seven-day winning streak, as investors sold some of the market's recent winners to take profits, and the S&P 500 index ended near break-even.

Apple, up 3.5 percent at $156.74, gave the top boost to the Nasdaq a day after the iPod and iPhone maker reported a quarterly profit that beat forecasts. Starbucks, up 18.4 percent at $17.39, ranked as the Nasdaq's second-biggest gainer, after its quarterly profit also beat estimates.

Their advance helped extend the Nasdaq's winning streak -- now the longest such stretch since September 1996. Technology bellwether Apple and coffee chain Starbucks are among stocks that investors use as barometers of consumer spending trends.

After the bell, Internet auctioneer eBay Inc posted a quarterly profit and revenue that beat Wall Street's forecasts. Its stock shot up more than 3 percent in extended-hours trading from a Nasdaq close at $19.45.

"Today's action is a relative positive in that you had some earnings come out that were good, but we are actually near the top of the range," said Richard Sparks, senior equities analyst at Schaeffer's Investment Research in Cincinnati.

"There's a kind of a pause until we get more news on both the earnings and the economic front."

The Dow Jones industrial average <.DJI> shed 34.68 points, or 0.39 percent, to 8,881.26. The Standard & Poor's 500 Index <.SPX> dipped just 0.51 of a point, or 0.05 percent, to 954.07. But the Nasdaq Composite Index <.IXIC> gained 10.18 points, or 0.53 percent, to 1,926.38.

The S&P 500 briefly hit a 2009 intraday high of 959.83.

For the year, the Nasdaq is up 22 percent.

WELLS FARGO OFF TRACK

But both the S&P and the Dow industrials were reined in by disappointing results from banks, including Wells Fargo & Co,down 3.6 percent at $24.45. The S&P Financial Index slipped 0.2 percent.

Bank of New York Mellon slid 6.2 percent to $27.32 after the world's largest trust bank posted a 43 percent drop in second-quarter profit.

Profit-taking in some of the market's recent winners, including Coca-Cola Co, down 2.4 percent at $49.13, also dragged on the broader market.

On the energy front, shares of Exxon Mobil Corp dropped 0.7 percent to $69.99 as oil prices retreated slightly. The S&P energy index slid 1 percent.

But strong profits from NVR Inc sparked a run-up in home builders' stocks. The Dow Jones U.S. home construction index shot up 5.2 percent. NVR's stock jumped 5.4 percent to $584.17.

QUALCOMM SLIDES LATE

In other earnings news after the bell, chip maker Qualcomm Inc posted a smaller quarterly profit as slower cellphone sales softened demand for its wireless chips.

Qualcomm's stock, which had risen sharply in the last week, fell 4 percent after the news in extended trading. Qualcomm shares ended regular Nasdaq trading at $48.45, up 1 percent before the quarterly results.

Federal Reserve Chairman Ben Bernanke reiterated in testimony to the Senate Banking Committee on Wednesday that the U.S. economic outlook is improving, but that supportive policies would be necessary for a while to prevent rising joblessness from sapping the recovery.

Volume was moderate on the New York Stock Exchange, with 1.08 billion shares changing hands, below last year's estimated daily average of 1.49 billion. On the Nasdaq, about 2.38 billion shares traded, above last year's daily average of 2.28 billion.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 4 to 3, while on the Nasdaq, about eight stocks rose for every five that fell. (Editing by Jan Paschal)

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