Closing Bell: Stocks Gain, Oil Dips as Investor Fears of Syria Strike Fade
The Dow Jones industrial average (^DJI) picked up 127 points, or 0.7 percent, to 15,191, the Standard & Poor's 500 index (^GPSC) gained 12 points, or 0.7 percent, to 1,684 and the Nasdaq composite index (^IXIC) added 22 points, or 0.6 percent, to 3,729.
Fears of action against Syria eased after President Barack Obama said Monday he saw a possible breakthrough in the situation after Syria's prime minister backed a Russian proposal that Syria hand over its chemical weapons to representatives of Russia, the UN and "other countries" for destruction.
Crude oil, which had closed above $110 a barrel Friday, lost $2.13, or 2 percent, to $107.39 a barrel.
Apple (AAPL) introduced two new iPhones, including the "iPhone 5C" that comes in five colors and starts at $99 with a contract. The new model is priced to bring one of the industry's costliest smartphones within reach of the masses in poorer emerging markets.
But the announcements left investors unimpressed. Shares of Apple, the most valuable technology company, lost $11.53, or 2.3 percent, to close at $494.64 and were the biggest drag on the S&P 500 and Nasdaq composite indexes.
In related news, the makeup of the Dow is getting a shakeup. It's dropping Bank of America, Hewlett-Packard and Alcoa, to be replaced by Goldman Sachs, Nike, and Visa at the start of trading on Sept. 23. The Dow is made up of 30 stocks.
S&P Dow Jones Indices said the change won't disrupt the level of the industrial average. It said it made the change to diversify the sector and industry group representation of the index.
Hewlett-Packard (HPQ) dipped 0.4 percent to $22.27, Alcoa (AA) was off a mere 3 cents to $8.06 and Bank of America (BAC) actually rose almost 1 percent to $14.61. Meanwhile, Visa (V) rose 3.4 percent to $184.59; Nike (NKE) added 2.2 percent to $66.82; and Goldman Sachs (GS) tacked on 3.5 percent to $165.14.
Tesco, Britain's largest retailer by sales, has agreed to sell 150 of its 200 loss-making Fresh & Easy stores in the United States to Los Angeles-based Yucaipa Cos., a private-equity firm. Tesco chief executive Philip Clarke said more than 4,000 jobs will be protected by the sale.
More Stocks in the News:
- McDonald's (MCD) gained 0.5 percent to $96.89 after the fast-food restaurant chain reported a better-than-expected 1.9 percent increase in global sales at established restaurants in August.
- Shares of Urban Outfitters (URBN) slid more than 10 percent to $38.35 after the retailer said its third-quarter sales increases were weaker than earlier in the year.
- ConAgra (CAG) shares lost 6 percent to $31.54 after it revised downward its expectations for first-quarter profit below analyst expectations, because of weak sales at its consumer foods business, which includes Chef Boyardee canned pasta, Hunt's sauces and Slim Jim beef jerky. The stock ended Monday up 14 percent for the year.
- PVH Corp. (PVH) shares sank 5.6. percent to $124.66 after the clothier gave a weak outlook for the year. The company, whose brands include Calvin Klein and Tommy Hilfiger, warned late Monday that is taking a cautious stance on the remainder of the year due to uncertain economic conditions.
- Microsoft (MSFT) rose 2.3 percent to $32.39 on rumors about who might succeed CEO Steve Ballmer when he retires next year.
- Netflix (NFLX) jumped 6.4 percent to $313.06 as it continued to regain investor confidence after gaffes two years ago that initially drove away subscribers.
- The Commerce Department releases July data on wholesale trade.
- Men's Wearhouse (MW) is scheduled to report quarterly corporate earnings.