Apple is most valuable stock ever, but stocks stall

Apple's market cap tops $623 billion, beating a record set by Microsoft in 1999. Stocks end flat. Aetna will buy Coventry Health for $5.7 billion. Urban Outfitter shares jump on strong results. Gold moves up; oil slips.

By Charley Blaine Aug 20, 2012 12:35PM
Charley BlaineUpdated: 7:20 p.m. ET

Stocks finished very little changed today as Apple (AAPL) surged to a new high and there was excitement about a big deal in health care.

The good news was this: The market opened lower but recovered nearly all of its losses at the end of the day. The close, however, left the major averages holding just below their highs for the year. The bad news is those highs have turned into strong resistance barriers.

Apple jumped $17.04 to an all-time high of $665.15, pushing its market capitalization to $623.5 billion. That's the highest market capitalization ever, beating a $619 billion market cap sported by Microsoft (MSFT) in 1999. Microsoft, the publisher of MSN Money, was off 16 cents to $30.74, translating into a current market cap of $257.7 billion. Apple is up 64% for the year.

Meanwhile, Coventry Health Care (CVH) jumped $7.10 to $42.04 after Aetna (AET) agreed to buy the health insurance company for $5.7 billion. Aetna rose $2.14 to $40.18. Coventry and Aetna were the first- and third-best percentage gainers among stocks in the Standard & Poor's 500 Index ($INX). In between was First Solar (FSLR), up $1.20 to $22.46.

Against the Apple news and the Aetna-Coventry deal was an earnings disappointment from Lowe's (LOW) and confusion about whether former Best Buy (BBY) CEO Richard Schulze really plans to try to take the company private. Best Buy named Hubert Joly as CEO; he had been CEO of hospitality company Carlson.

The Dow Jones industrials ($INDU) closed down 4 points to 13,272 after dropping as many as 45 points early in the session. The S&P 500 fell slightly to 1,418, and the Nasdaq Composite Index ($COMPX) was off less than a point to 3,076. The Nasdaq-100 Index ($NDX) scratched out a 4-point gain to 2,784, in large part because of Apple's surge.

Article continues below
Facebook (FB) shares fell to as low as $18.75, the first time they have been below $19 since the company went public in May. The droop, however, generated considerable buying and the shares closed up up 96 cents to $20.01.

The U.S. market was pressured at the open by Europe, where officials at the European Central Bank denied a story in Der Spiegel that the bank was thinking about a plan to buy unlimited amounts of  the bonds of struggling countries to keep interest rates at reasonable levels.

But the U.S. market gathered strength once European stocks closed with small losses.

On Friday, the S&P 500 came within one point of its 2012 closing high of 1,419.04. It's still within a point of that high. The Dow finished about seven points below its closing high this year of 13,279.32.

The market has quietly moved higher since hitting a bottom in early June. The Dow is up 9.7% since then, with the S&P 500 up 11% and the Nasdaq up 12%.

A worry of, say, the last two weeks is that the market is looking overbought. The S&P 500's relatively strength index was 77.2. The Nasdaq's RSI was 81.5. Readings above 70 suggest a stock or index is overbought. The Dow's RSI was 70 today.

An RSI measures the latest price against prior changes.
  • Check here to see the S&P 500's relative strength index.

Urban Outfitters results cheer investors

After the close, shares of apparel retailer Urban Outfitters (URBN) jumped 16.5% to $36.45 on better than expected earnings and revenue. The company earned 42 cents a share on revenue of $676.3 million, up from 33 cents and $609 million a year ago. Sales at its namesake stores were up 14%. Online and catalogue sales were up 22%.


Meanwhile, gun-make Sturm, Ruger (RGR) said it manufactured its one-millionth handgun for 2012 last week and should be able beat 2011's record output of 1.11 million units. Shares were off slightly to $44.28 after hours after dropping 86 cents to $44.29 in regular trading. The shares are up more than 32% this year.


Best Buy reports second-quarter earnings before Tuesday's open, and quarterly results also are due from Barnes & Noble (BKS), Dell (DELL) and La-Z-Boy (LZB).


The big economic report will come at 2 p.m. ET when the Federal Reserve releases the minutes of its July 31-Aug. 1 meeting. The report will be parsed closely for clues on whether the Fed will start a new stimulus package, perhaps as early as September.

Futures trading suggests a modestly higher open on Tuesday.

Crude oil dips; gold rises
Crude oil (-CL) settled down 4 cents to $95.97 a barrel in New York. Brent Crude for October delivery was off a penny to $113.70 a barrel.

The national average price of gasoline was $3.72 a gallon, unchanged since Friday, according to AAA's Daily Fuel Gauge Report.

Gold
(-GC) was up $3.60 to $1,623 an ounce. Silver (-SI) was up 59.1 cents to $28.59 an ounce, and copper (-HG) was down 4.9 cents to $3.371 a pound.

We should note that the drought news continues to be bad. Corn (-ZC) was up 16.5 cents to 8.2375 a bush. Wheat (-ZW) rose 8.25 cents to $9.0275 a bushel. Corn is up nearly 30% this quarter alone. Wheat is up 20%.

Interest rates were lower, with the 10-year Treasury yield falling to 1.814% from 1.816% on Friday. The dollar was slightly lower against major currencies.

Energy prices -- New York close



Mon.

Fri.

Month chg.

YTD chg.
Crude oil (-CL)

$95.97

$96.01

8.98%

-2.89%
(per barrel)











Heating oil (-HO)

$3.0931

$3.0926

8.61%

6.14%
(per gallon)











Natural gas (-NG)

$2.7760

$2.7190

-13.49%

-7.13%
(per mil. BTU)











Unleaded gasoline (-RB)

$3.0308

$3.0275

9.25%

14.05%
(per gallon)











Brent crude 

$113.70

$113.71

8.37%

5.89%
(per barrel)











Retail gasoline

$3.7200

$3.7200

6.29%

13.55%
(per gallon; AAA)












Aetna likes Medicare and Medicaid
Aetna's deal for Coventry Health Care would make the company one of the largest providers of government-financed health care. The $42.08 price is a 20% premium to Coventry's shares as of Friday's close. About 65% of the deal is in cash. 

Aetna has been interested in expanding government-based health plans -- Medicare for the elderly and Medicaid for the poor -- that are growing as baby boomers and states look for help managing Medicaid costs.

The deal follows on the heels of other health care insurers bulking up their offerings by adding Medicare and Medicaid insurance providers in light of the federal health care law that aims to provide affordable coverage for Americans, The Wall Street Journal noted.

Lowe's: A turnaround that hasn't turned
Lowe's shares were off $1.61 to $26.26 after reporting weaker-than-expected quarterly sales and earnings. And the company cut its profit outlook for the year as the home improvement chain lost market share to rival Home Depot (HD).

"Lowe's is a turnaround story, and it's not turning," said Sanford C. Bernstein & Co analyst Colin McGranahan.

The company has cut jobs, curbed store expansion plans and streamlined its supply chain to trim costs and compete more effectively, but, CEO Robert Niblock conceded on the company's conference call, "The benefits are accruing at a slower rate than I had expected."

Lowe's earned 64 cents a share; analysts had expected 70 cents. Net income fell to $747 million from $830 million. Sales fell 2% to $14.25 billion. Analysts had expected $14.46 billion. Lowe's now expects flat sales for the fiscal year ending Feb. 1. It projected earnings of $1.64 a share, down from a May outlook of $1.73 to $1.83 a share.

More distractions at Best Buy
Best Buy hired Hubert Joly as its new chief executive because it wants the French turnaround expert's acumen in improving businesses. Best Buy has been struggling against competition from Amazon.com (AMZN), Apple's stores as well as a soft economy. Shares are off 20% this year and 68% from its all-time high in 2006.

Shares were fell $2.11 to $18.16 today as the possibility of a buyout seemed less likely after talks with founder Richard Schulze broke down over the weekend. Best Buy said late Sunday that Schulze had rejected its offer to let him do due diligence and pursue his interest in taking over the company. Schulze balked at conditions connected with the offer.

"It is clear to us that there is quite a bit of acrimony between Mr. Schulze and the board of directors," analyst Scot Ciccarelli told Reuters. "This distracting saga isn't close to being finished."

Financial, health care stocks lead the market
The market was led by financial and health care stocks, although neither sector moved much. Telecommunications and consumer discretionary stocks were the weak links.

Only 11 of the 30 Dow stocks were higher today, led by Hewlett-Packard (HPQ), Bank of America (BAC) and JPMorgan Chase (JPM). American Express (AXP) and Verizon Communications (VZ) were the laggards. Hewlett-Packard reports fiscal-third-quarter results after Wednesday's close.

Only 190 S&P 500 stocks were higher. Coventry Health Care, First Solar and Aetna were the leaders, and Best Buy and Lowe's were the laggards.

Dell and Apple were the top performers among Nasdaq-100 stocks. Sears Holdings (SHLD) and Autodesk (ADSK) were the laggards.

Short hits from the markets -- New York close



Mon.

Fri.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.0900%

0.090%

-10.00%

800.00%
5-year Treasury note 

0.792%

0.799%

32.22%

-4.58%
10-year Treasury note

1.814%

1.816%

21.58%

-3.05%
30-year Treasury bond

2.927%

2.934%

13.58%

1.32%
Currencies











U.S. Dollar Index

82.5

82.663

-0.25%

2.46%
British pound

1.5713

1.5704

0.20%

1.13%
(in U.S. $)

 








U.S. $ in pounds

£0.636

£0.637

-0.20%

-1.12%
Euro in dollars

$1.23

$1.23

0.23%

-4.85%
(in U.S. $)

 








U.S. $ in euros

€ 0.811

€ 0.810

-0.23%

5.09%
U.S. $ in yen 

79.49

79.56

1.76%

3.10%
U.S. $ in Chinese

6.36

6.35

-0.04%

0.47%
yuan











Canada dollar

$1.011

$1.012

1.35%

3.01%
(in U.S. $)

 








U.S. dollar 

$0.990

$0.988

-1.26%

-2.92%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,623.00

$1,619.40

0.78%

3.59%
(per troy ounce)

 








Copper (-HG)

$3.371

$3.420

-1.36%

-1.89%
(per pound)

 








Silver (-SI)

$28.5930

$28.0020

2.43%

2.43%
(per troy ounce)

 








Wheat (-ZW)

$9.0275

$8.9450

1.63%

38.30%
(per bushel)

 








Corn (-ZC)

$8.2375

$8.073

2.30%

27.42%
(per bushel)

 








Cotton 

$0.7483

0.733

4.89%

-18.38%
(per pound)

 








Coffee

$1.6455

1.632

-5.65%

-28.35%
(per pound)

 








Crude oil (-CL)

$95.97

$96.01

8.98%

-2.89%
(per barrel)










 

205Comments
avatar
WHY is the USA BANKRUPT? Read this:
We have been hammered with the
 Propaganda that it was the Iraq war and The war on terror that is bankrupting us.   
I hope the following 
14 reasons are forwarded over and over again until they are read so many times that the reader gets sick of reading them. I also have included the URL's for verification of all the following  facts:

1. 
$11 Billion to $22 billion is spent on welfare
 To illegal aliens each year by state governments.
Verify 

At: 
http://www.fairus.org/site/PageServer?pagename=iic_immigrationissuecenters7fd8 

2.
 
$22 Billion dollars a year is spent on food
 Assistance programs such as food stamps, WIC, and free school lunches for illegal aliens.
Verify 

At: 
http://www.cis.org/articles/2004/fiscalexec.HTML  

3.

$2.5 Billion dollars a year is spent on
 Medicaid for illegal aliens. 
Verify at: 

http://www.cis.org/articles/2004/fiscalexec.HTML 

4.
 
$12 Billion dollars a year is spent 
 on Primary and secondary school education For children here illegally and they Cannot speak a word of English!
Verify 

At
 http://transcripts.CNN.com/TRANscriptS/0604/01/ldt...0.HTML</ a>  

5.

$17 Billion dollars a year is spent for
 Education for the American-born Children of illegal aliens, known as Anchor babies.
Verify

At
  http://transcripts.CNN.com/TRANscriptS/0604/01/ldt.01.HTML</ a> 

6.
 
$3 Million Dollars a DAY is spent to
 Incarcerate illegal aliens. 
Verify at:  

http://transcripts.cnn.com/%20TRANscriptS/0604/01/ldt.01.HTML</ a> 
7. 

30%
 of all Federal Prison Inmates are illegal aliens.
Verify at:
 http://transcripts.CNN..com/TRANscriptS/0604/01/ldt..01.HTML</ a> 


8. 
$90 Billion Dollars a year is spent on
 Illegal aliens for Welfare & social Services by the American taxpayers.
Verify 

At
http://premium.cnn.com/TRANSCIPTS/0610/29/ldt.01.HTML 

9.

$200 Billion dollars a year in suppressed
 American wages are caused by the illegal Aliens.
Verify

At
http://transcripts.cnn.com/TRANSCRI</ a>  

13.
 
In 2006, illegal aliens sent home
 $45 BILLION in remittances to their Countries of origin.
Verify 

At
:. <http://www/..rense.com/general75/niht.htm 
 
14.
 
     The Dark Side of Illegal Immigration: Nearly One million sex crimes committed By Illegal Immigrants In The United States .
Verify 

At
: http: // www.drdsk.com/articleshtml 
M
The total cost is a whopping
$ 338.3 BILLION DOLLARS
 A YEAR AND IF YOU'RE LIKE ME, HAVING TROUBLE UNDERSTANDING THIS AMOUNT OF MONEY, IT IS $ 338,300,000,000.00 WHICH WOULD BE ENOUGH TO STIMULATE THE ECONOMY FOR THE CITIZENS OF THIS COUNTRY.
Are  we THAT Stupid?
 
YES, FOR ALLOWING THOSE
 IN THE U.S. CONGRESS TO GET AWAY WITH DOING THIS YEAR AFTER YEAR!!!!!
Aug 20, 2012 3:07PM
avatar
pretty sad when the left says we have to increase welfare because it's driving the economy. 
Aug 20, 2012 3:31PM
avatar
August 19th, 2012
Newsweek
Niall Ferguson

America Needs a New President

...the question confronting the country nearly four years later is not who was the better candidate four years ago. It is whether the winner has delivered on his promises. And the sad truth is that he has not.

In his inaugural address, Obama promised “not only to create new jobs, but to lay a new foundation for growth.” He promised to “build the roads and bridges, the electric grids, and digital lines that feed our commerce and bind us together.” He promised to “restore science to its rightful place and wield technology’s wonders to raise health care’s quality and lower its cost.” And he promised to “transform our schools and colleges and universities to meet the demands of a new age.” Unfortunately the president’s scorecard on every single one of those bold pledges is pitiful.

Aug 20, 2012 2:49PM
avatar
Another day, another butt load of illegals enrolled in our welfare programs. Oh well, the money supply is endless so what the F.

Butt loads....something the dems are very familiar with.
Aug 20, 2012 1:43PM
avatar
Apple market cap at $622 billion - Holy Crap, that's huge.  Hey, wait minute, that's only enough to fund the federal government for about 2 months.

"It's a spending problem, stupid"

Aug 20, 2012 3:10PM
avatar
absolute power corrupts absolutely. Hence the Executive Order. No congress or other checks and balances required.
Aug 20, 2012 2:01PM
avatar

I don't know if anybody noticed, but on last Friday after the close crude oil prices fell $7.49. And now you look it's back up to $95 a barrel. Hmmmm seems like to me its all a big farce and manipulation. Control of commodity trading needs to happen.

Aug 20, 2012 2:51PM
Aug 20, 2012 4:30PM
avatar

That's [$622 billion] the highest market capitalization ever, beating a $619 billion market cap sported by Microsoft . . . in 1999.

 

On a financial/money Web site, that is an inexcusably ignorant - nay, stupid - observation to make. It's to be expected from the wizards at The Daily Bugle. But here?

 

In terms of AAPL's valuation in 2012 dollars, the 1999 MSFT valuation was $842 billion. Even if the "i" in iPhone and iPad stand for "inflation," they haven't sold well enough to exceed what MSFT did in 1999.

Aug 20, 2012 2:51PM
avatar
How nice 15 spams and 15 comments...
Aug 20, 2012 3:02PM
avatar
President does interviews with Entertainment Tonight. 

What's next a cameo on Keeping Up with the Kardashians? Maybe a spot on Bizarre Foods, the Kenyan edition? He can show the fat bald dude how his parents used to cook up Giraffe ball stew and Warthog ribs.
Aug 20, 2012 4:55PM
avatar

So now there is an **** with a picture of the joker talking about eating dead fetuses.  OH wow your so extreme and intense, your just so in everybodys face.  You are not the first sh!t disturber and won't be the last, lets all ignore this douche bag.

Aug 20, 2012 9:43PM
avatar
The worst Americans have been career politicians. Period.
Aug 20, 2012 1:27PM
avatar

Right on schedule.  Here's Charley!  A new thread with the same BS!!!!  Hilarious!

Aug 20, 2012 4:22PM
avatar
Money printing only benefits the first few recipients (government/business cronies).  As the paper flows out from there, the pumped up demand starts to increase prices and everyone else gets screwed.  THAT is FACT and HISTORY.

Printing money is another hidden tax on anyone holding paper assets and those who want or need to buy anything. 

You can get the cash for the spending by direct taxes or borrowing/printing.  Since, there is not enough that can be gotten from the "rich" if you tax them at 100%, we have to face reality.   CUT THE SPENDING !!!!
Aug 20, 2012 9:45PM
avatar
Socialist deprives your right to rise beyond your circumstance. I understand incentives, however believe in charity to those who are incaple of fending for themselves. Capitalism is needed with charity. People who can work, should not need charity. That is the problem.
Aug 20, 2012 4:33PM
avatar
All Prices( not wages) need to drop 35% to stimulate this economy.
Aug 20, 2012 3:21PM
avatar

You are giving me a bit of "doublespeak", V_L.  This "fiat" was caused by whom in this "elimination" of the middle class as we "knew" it?  You are pointing to one party, I gather?  Is this a "trickle up" effect, now?  I find that interesting.

 

Agree with the flat tax which should have been instituted year's ago.  Forbes had the right idea back when.  I could go on but think you have a grasp of things' as you see them and that is fine with me. 

Aug 20, 2012 4:35PM
Aug 20, 2012 9:28PM
avatar
 Socialism definition is simple. The economy is funded  with loans from a taxpayer created pool of money.


In other words...it's all a huge pay it forward ponzy scheme that always ends up collapsing.
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