Shares of technology bellwether Apple dipped, dragging the S&P 500 and Nasdaq lower on Monday after investors were alarmed by the low demand for the company’s products. However, the Dow Jones still managed to add some points. Investors continue to await results from major banks this week. Meanwhile, President Barack Obama said law makers should act fast to raise the debt ceiling and also said he is not ready to bargain on this issue. The technology sector was the biggest loser whereas the industrial sector was the major gainer among the S&P 500 industry groups.
The Dow Jones Industrial Average (DJI) gained 0.1% to close the day at 13,507.32. The Standard & Poor 500 (S&P 500) slipped 0.1% to finish yesterday’s trading session at 1,470.68. The tech-laden Nasdaq Composite Index dropped 0.3% to end at 3,117.50.The fear-gauge CBOE Volatility Index (VIX) gained 1.2% to settle at 13.52. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.6 billion shares, significantly lower than 2012’s daily average of 6.42 billion shares. Advancing stocks outpaced decliners on the NYSE; as for 50% stocks that rose, 46% moved lower.
Technology bellwether Apple Inc. (NASDAQ:AAPL) lost 3.6% and was largely responsible for dragging the S&P 500 and Nasdaq into negative territory. The Wall Street Journal reported that Apple has reduced its demand for LCD screens and other components for the iPhone 5 in the current quarter due to lower-than-expected demand. Shares of Apple fell as much as 4% in the early part of the trading session, reaching its lowest level in more than ten months.
Following these developments, the technology sector closed in the red. The Technology SPDR (XLK) lost 0.6%. Stocks such as Google Inc (NASDAQ:GOOG), Silicon Graphics International Corp (NASDAQ:SGI), AOL, Inc. (NYSE:AOL) and Blucora Inc (NASDAQ:BCOR) slipped 2.3%, 0.7%, 0.5% and 1.0%, respectively.
Investors are also waiting for results from major financial companies this week. JPMorgan Chase & Co. (NYSE:JPM), Citigroup Inc. (NYSE:C), Bank of America Corp (NYSE:BAC) and Goldman Sachs Group, Inc. (NYSE:GS) are slated to report their quarterly results. During this week, 38 S&P 500 companies will report their quarterly results. Data from Thomson Reuters shows that S&P 500 profits will increase 1.9% year over year. In the third-quarter, S&P 500 earnings increased by only 0.1%.
President Barack Obama appealed to U.S. lawmakers to take fast action to raise the debt ceiling. He also said a failure to do so result in problems for the economy and “Social Security benefits and veterans' checks will be delayed.” President Obama said he will disclose his proposals in the coming week.
The House of Representatives Speaker John Boehner said: “The House will do its job and pass responsible legislation that controls spending, meets our nation’s obligations and keeps the government running, and we will insist that the Democratic majority in Washington do the same.” On the other hand, Senate Minority Leader Mitch McConnell said: “The President and his allies need to get serious about spending, and the debt-limit debate is the perfect time for it.”
Industrials had a good run and was the major gainer among the S&P 500 industry groups. The Industrial Select Sector SPDR (XLI) gained 0.4%. Stocks such as Union Pacific Corporation (NYSE:UNP), 3M Co (NYSE:MMM), The Boeing Company (NYSE:BA), Deere & Company (NYSE:DE) and United Parcel Service, Inc. (NYSE:UPS) surged 0.3%, 0.8%, 1.9%, 0.3% and 1.7%, respectively.