Boeing and Yum! Brands Inc. advanced at least 3 percent after reporting first-quarter earnings that topped estimates. Apple fell 0.2 percent after planning to return an additional $55 billion in cash to shareholders amid its first profit decline in a decade. Procter & Gamble Co. (PG) dropped 5.9 percent as its earnings forecast missed analyst projections. AT&T Inc. fell 5 percent after sales trailed estimates.
The S&P 500 added less than 0.1 percent to 1,578.79 at 4 p.m. in New York. The index has rallied 2.4 percent over four days. The Dow Jones Industrial Average dropped 43.16 points, or 0.3 percent, to 14,676.30 today. More than three stocks rose for every two that fell on U.S. exchanges as 6.3 billion shares traded hands, in line with the three-month average.
“First-quarter earnings have generally exceeded expectations and looked good, but second-quarter guidance seems to be ratcheting lower,” Eric Teal, chief investment officer at First Citizens BancShares Inc., which manages $4.5 billion in Raleigh, North Carolina, said in a phone interview. “So it’s a bit of a mixed bag and the market has been volatile.”
Forty-seven S&P 500 companies post earnings today. Of the 180 companies that have published results so far in this reporting season, 73 percent have exceeded analysts’ predictions for earnings, data compiled by Bloomberg show. Profit at S&P 500 companies dropped 1.1 percent in the first three months of the year, according to forecasts compiled by Bloomberg. That would mark the first year-over-year decrease since 2009.
Analysts have trimmed their projections for the second quarter, forecasting earnings to expand 5.5 percent, data compiled by Bloomberg show. They had expected an increase of 6.2 percent at the beginning of April.
The S&P 500 has surged 133 percent from a 12-year low in 2009 as corporate earnings beat estimates and the Federal Reserve embarked on three rounds of bond purchases to stimulate the economy. Benchmark indexes reached record highs on April 11.
U.S. stocks suffered declines during the second quarter in each of the past three years, with losses in the S&P 500 averaging 5.2 percent, data compiled by Bloomberg show.
“The earnings season has been enough to hold stocks where they are in light of some less-than-hoped-for macro data,” Lawrence Creatura, a Rochester, New York-based fund manager at Federated Investors Inc., which oversees about $380 billion, said by phone. “Time will tell if it will remain enough as we move through what’s a seasonally more difficult time.”
Data today showed orders for U.S. durable goods fell in March by the most in seven months as demand slumped for commercial aircraft and business investment cooled.
The Chicago Board Options Exchange Volatility Index (VIX), or VIX, rose 1 percent to 13.61. The gauge, which moves in the opposite direction to the S&P 500 about 80 percent of the time, is down 24 percent for the year.
Seven out of the 10 S&P 500 industries gained as commodity and energy companies advanced the most, rising at least 1.2 percent. Phone stocks had the biggest loss, down 2.9 percent as a group.
Boeing gained 3 percent to $90.83. The aircraft maker said earnings were $1.73 a share in the first quarter, topping the average analyst estimate of $1.49 per share, as increased deliveries for 777- and 737-model jets made up for the halt in buyers picking up Dreamliners while that plane was grounded.
Yum Brands increased 7 percent to $68.65. The owner of the KFC and Pizza Hut dining chains said profit excluding certain items was 70 cents a share as new menu items helped Taco Bell’s domestic sales. Analysts estimated 60 cents, the average of 25 projections compiled by Bloomberg.
Newfield (NFX) Exploration Co. climbed 7.4 percent to $21.31, leading energy stocks to a 1.2 percent gain. The oil producer reported quarterly profit that beat analysts’ estimates by the most in a year, data compiled by Bloomberg show. Newfield said it expects to meet a 2013 output target.
WellPoint Inc. gained 5.8 percent to $73.33. The second- biggest U.S. health insurer reported profit that outpaced analysts’ estimates and raised its forecast, fueled by the acquisition of Amerigroup Corp. and lower-than-anticipated medical costs.
General Dynamics Corp. advanced 6.9 percent to $71.73. The maker of Abrams tanks and Gulfstream business jets beat analysts’ estimates for first-quarter profit as the company is focusing on cost-cutting and increasing margins.
Buckeye (BKI) Technologies Inc. surged 27 percent to a record $37.86. The manufacturer of specialty-cellulose products agreed to be bought by Georgia-Pacific LLC for $37.50 a share in cash. The transaction is valued at about $1.5 billion, including debt.
Apple (AAPL) slipped 0.2 percent to $405.46. The maker of iPhones forecast sales that missed analysts’ predictions and reported an 18 percent decline in earnings, its first profit drop since 2003. Apple also said it will return an additional $55 billion in cash to shareholders to compensate for a stock that’s been hammered by signs of slowing growth. Apple shares have slumped 24 percent this year amid signs of slowing growth.
The company boosted its quarterly dividend and allotted more cash to buybacks, announcing plans to borrow funds for what it called the largest share-repurchase program in history.
P&G (PG) slipped 5.9 percent, the most in about four years, to $77.12 after predicting full-year core earnings will be in the range of $3.96 to $4.04 a share. Analysts surveyed by Bloomberg had estimated earnings at $4.06 per share for 2013.
Results in the current quarter will be affected by increased marketing expenses for new product introductions, Chief Financial Officer Jon Moeller said. Foreign currency exchange is also expected to reduce net sales by 2 percent in the period, P&G said.
Amgen Inc. declined 6.9 percent, the most in four years, to $104.93. Revenue increased 5 percent to $4.24 billion, less than the $4.37 billion estimated by analysts. This is the first time in 11 quarters that the company has missed expectations, according to Bloomberg Industries.
AT&T lost 5 percent to $37.04 for the biggest retreat since February 2009. The largest U.S. phone company said sales dropped 1.5 percent to $31.4 billion in the first quarter, dragged down by a sluggish landline business and competition with Verizon Wireless. Analysts on average had forecast $31.7 billion.
Edwards Lifesciences Corp. (EW) tumbled 22 percent, the largest drop since 2000, to $64.60. The biggest maker of aortic heart valves implanted with a catheter cut its 2013 forecast as first- quarter sales were slower than anticipated.
Motorola Solutions Inc. declined 9.3 percent to $56.02. The maker of industrial gear such as two-way radios and bar-code scanners reported quarterly profit and sales that trailed analysts’ estimates. Corporate customers are still working to rebound from the economic slump, causing them to put off orders, Chief Executive Officer Greg Brown said.
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