* Jobless claims drop to five-year low
* Apple shares drop after results
* Netflix jumps 40 percent after reporting profit
* Indexes: Dow up 0.43 pct, S&P up 0.12 pct, Nasdaq off 0.45
By Chuck Mikolajczak
NEW YORK, Jan 24 The Dow and S&P 500 advanced on
Thursday, with the benchmark S&P index on track for its first
seven-day streak of gains in over six years as solid economic
data managed to outweigh a steep decline in Apple shares.
Apple Inc dropped 10.4 percent to $460.69 after the
technology giant missed Wall Street's revenue forecast for a
third straight quarter as iPhone sales were poorer than
expected, lending credence to recent concerns its days as the
dominant player in consumer electronics may be on the wane.
The drop wiped out roughly $50 billion in Apple's market
capitalization to $432 billion, leaving the company vulnerable
to losing its status as the most valuable U.S. company to second
place ExxonMobil Corp, at $417 billion.
A trio of economic reports helped buoy the market, with data
showing a decline in weekly jobless claims and an increase in
manufacturing, while a gauge of future economic activity
"The claims numbers are clearly a big surprise and were very
good numbers - they imply we may have a good employment number
for the month of January," said Hugh Johnson, chief investment
officer of Hugh Johnson Advisors LLC in Albany, New York.
"You have Apple and technology on the one side and the rest
of the market on the other side."
The gains marked the first time the S&P 500 had risen above
1,500 since Dec. 12, 2007 and put the index on pace for its
seventh straight advance, its longest streak since October 2006.
The advance for the S&P, and muted declines in the Nasdaq in
spite of the decline in Apple, were viewed as a positive sign,
as investors take encouragement from an improving global economy
and move into stocks more closely tied to economic fortunes,
such as industrials.
General Electric rose 0.5 percent to $22.06 and
United Parcel Service gained 2.4 percent to $82.30. Of
the 10 major S&P sectors, only technology, off 1.5
percent, was lower.
The Dow Jones industrial average gained 58.82 points,
or 0.43 percent, to 13,838.15. The Standard & Poor's 500 Index
added 1.78 points, or 0.12 percent, to 1,496.59. The
Nasdaq Composite Index dropped 14.25 points, or 0.45
percent, to 3,139.42.
The domestic data meshed with those overseas showing growth
in Chinese manufacturing accelerated to a two-year high this
month and a buoyant Germany took the euro zone economy a step
closer to recovery.
Apple's disappointing results drew a round of price-target
cuts from brokerages. At least 14 brokerages, including Barclays
Capital, Credit Suisse and Deutsche Bank, cut their price target
on the stock by $142 on average. Morgan Stanley removed the
stock from its 'best ideas' list.
In contrast to Apple, Netflix Inc surprised Wall
Street Wednesday with a quarterly profit after the video
subscription service added nearly 4 million customers in the
U.S. and abroad. Shares surged 37.6 percent to $142.10, its
biggest percentage jump ever.
Diversified U.S. manufacturer 3M Co reported a 3.9
percent rise in profit, meeting expectations, on solid growth in
sales of its wide array of products, which range from Post-It
notes to films used in television screens. The shares slipped
0.2 percent to $99.28.
Corporate earnings have helped drive the recent stock market
rally. Thomson Reuters data through early Thursday showed that
of the 133 S&P 500 companies that have reported earnings, 66.9
percent have exceeded expectations, above the 65 percent average
over the past four quarters.