Stocks Close Mixed After Icahn Comments
Stocks in the US started the trading session mixed, as investors eyed a new benchmark for the S&P 500 index. The Dow Indusrials hit 16,000 a new milestone for the first time in its history. Exxon mobile continue to move higher on the heels of a report by the SEC that Warren Buffet purchased nearly 40 million shares of the integrated oil company during the past 45 days. Continued buying of Exxon buoyed the Dow while the S&P 500 index and the Nasdaq started the session in the red. Late in the day, comments from activist investor Carl Icahn that he is cautious on stocks, hit the major averages, knocking the down from all-time highs.
As the large cap S&P 500 index index approaches 1800, momentum has increased, which will likely catapult the index above this psychological level. Historically these levels have been met with minor euphoria, and have been breached only to see them revisited once the glee has faded. It is unlikely that this level will be the final destination for the strong bull rally given the current bent of global central banks such as the ECB, BOE and Federal Reserve, but the fireworks will be interesting until the music stops.
Microsoft (NASSDAQ:MSFT) was cut to underperform from Neutral at Bank of America (NYSE:BAC) . The price target remains $36. The bank cut the rating in saying its valuation already includes divestitures and restructuring. The bank has concerns about downward revisions, flat earnings and declining margins will be a burden on new management.
The S&P 500 index hit a new all-time intra-day high printing above the 1,800 level, but was unable to sustain the gains, and dropped back settling down on the trading session.
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