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US STOCKS-S&P, Nasdaq flat as Citi, Apple fall; Dow rises

Published 01/18/2011, 12:09 PM
Updated 01/18/2011, 12:12 PM

* Citi off as profit, revs miss expectations

* Apple off after CEO Jobs takes leave, to post results

* Dow up 0.6 pct, S&P, Nasdaq flat (Updates to midday, changes byline)

By Caroline Valetkevitch

NEW YORK, Jan 18 (Reuters) - The S&P and Nasdaq were little changed on Tuesday as disappointing Citigroup results weighed on financials and another medical leave by Apple Chief Executive Steve Jobs dragged down the stock, while the Dow rose.

Citigroup Inc fell 5.5 percent to $4.85 after the No. 3 U.S. bank reported a sharp drop in bond trading revenue that pushed profits below expectations.

The financial SPDR exchange-traded fund was off nearly 1 percent and the KBW bank index dropped 1.4 percent after recent gains. Stronger-than-expected results from JPMorgan Chase & Co last Friday buoyed optimism about bank stocks, which had rallied in recent weeks.

Bank of America Corp was down 2.2 percent at $14.93. The bank is set to report results later this week.

With the financial SPDR ETF, "we've been locked in a range for 16 to 18 months, so it appears it's going to test the upward boundary ... If we can consistently trade above that, that's going to attract more buying," said John Kosar, director of research at Asbury Research in Chicago.

Kosar said the financial sector was underinvested and has "room to run higher" in the near term.

Apple Inc fell 2.8 percent to $338.85 after the company said Jobs is taking his third medical leave since 2004, reviving concerns about the future of the maker of the iPad and iPhone.

Apple, which reports earnings after the bell, has about a 21 percent weighting on the Nasdaq 100, which was down 0.1 percent.

Caterpillar Inc helped to support the Dow, rising 2.6 percent at $96.01 after Raymond James raised its price target on the stock to $116 from $95.

Optimism about earnings have helped bolster stocks in recent weeks, with financials expected to have the highest growth rate of any S&P sector for the fourth quarter.

The Dow Jones industrial average was up 66.37 points, or 0.56 percent, at 11,853.75. The Standard & Poor's 500 Index edged up 0.70 point, or 0.05 percent, at 1,293.94. The Nasdaq Composite Index added 2.29 points, or 0.08 percent, at 2,757.59.

The S&P 500 posted a seventh straight week of gains on Friday.

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