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Boeing grounds Dow, Apple lifts tech

Wednesday, January 16, 2013 - 02:08

Jan. 16 - Summary of business headlines: Stocks finished mixed with more problems for Dow component Boeing, but Apple rebounds; JP Morgan Chase and Goldman Sachs roll in the dough; Gun stocks rally after gun control proposal. Conway G. Gittens reports.

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Blue chips snap a five-day rally, grounded by Boeing, but Apple shares get a reprieve - sending the Nasdaq higher. Nevertheless, the moves are still minor; the Dow down 23 points, the Nasdaq up 6 points. Japan's two biggest airlines decided to ground all Boeing 787 flights after an All Nippon Airlines had an emergency landing. The problem: electrical. Carter Leake follows the sector and downgraded Boeing when the most recent incidents began last week. SOUNDBITE: CARTER LEAKE, AEROSPACE ANALYST, BB&T CAPITAL MARKETS (ENGLISH) SAYING: "Boeing is going to forge ahead, regardless, they have to. If they find something that needs to be recertified post production that's costly. It can impede deliveries and so that's the risk. So I think we are a long way away from Boeing changing its production rates on the 787 but that still doesn't mean that it couldn't be costly." Shares of Boeing lost more than 3 percent. Japanese battery maker GS Yuasa slumped 4-1/2 percent in Tokyo. The other big story of the day: profits. Earnings at Goldman Sachs nearly tripled, while net income at JP Morgan Chase jumped 53 percent. Of the two, JP Morgan's results are the most important, says Fred Cannon, research director at Keefe Bruyette and Woods. SOUNDBITE: FRED CANNON, DIRECTOR OF RESEARCH, KEEFE BRUYETTE AND WOODS (ENGLISH) SAYING: "What worked is investment banking - issuing debt in particular for companies that are taking advantage of the low interest rate environment - that worked very well. Some other areas that might not last worked well- mortgage banking worked well and trading actually worked relatively better than expected." Shares of JP Morgan gained one percent, while Goldman Sachs jumped 4 percent. President Obama laid out his proposal for a new ban on assault weapons and mandatory background checks for all gun buyers in wake of the Connecticut school shooting a month ago. Shares of gun makers Smith and Wesson and Sturm Ruger moved higher on a bet gun sales will continue and doubt any laws will even be passed. Finally, European shares lacked momentum - finishing little changed.