December 24, 2013

Apple deal with China Mobile boosts stocks

Trading is light to start the week, but ‘everything is going in the right direction,’ one analyst says.

The Associated Press

NEW YORK — Stocks rose in quiet trading Monday as investors start to close the books on 2013.

Apple helped lift technology stocks after the company reached a deal to sell the iPhone to China’s largest wireless carrier.

The market has been moving broadly higher since last Wednesday, when the Federal Reserve said it will start pulling back on its stimulus program next month as the U.S. economy improves. Last week the government also raised its estimate for third-quarter economic growth to 4.1 percent, the fastest pace since 2011.

“Everything is going in the right direction,” said Rob Stein, chief executive officer of Chicago-based Astor Investment Management.

The Dow Jones industrial average rose 73.47 points, or 0.5 percent, to 16,294.61. The Standard & Poor’s 500 index was up 9.67 points, or 0.5 percent, to 1,827.99. The Nasdaq composite rose 44.16 points, or 1.1 percent, to 4,148.90.

Apple rose $21.07, or 4 percent, to $570.09 after the company reached a deal with China Mobile, the world’s largest cell phone provider, to sell the iPhone in the world’s most populous country. The iPhone is already sold through two smaller carriers there. Technology stocks in the S&P 500 rose 1.5 percent, more than twice as much as the broader index.

Trading was very light ahead of the Christmas holiday. Just 2.8 billion shares were traded on the New York Stock Exchange, well below the recent average of 3.4 billion.

Both the New York Stock Exchange and the Nasdaq Stock Market will be closed Wednesday for Christmas. Both exchanges will also close at 1 p.m. Eastern on Tuesday for Christmas Eve.

The market is heading for its best year in more than a decade. The S&P 500 index has increased 28 percent so far this year – 30 percent when dividends are included – putting it on track for its biggest annual gain since 1997.

“People want to hold on to these gains, so no one is going to take any undue risks this close to the end of the year,” said Stephen Carl, head equity trader at Williams Capital. The next two weeks, with Christmas and New Year’s Day both falling in the middle of the work week, will likely have light trading, he said.

In other economic news, consumer spending rose 0.5 percent in November, the most since June. Those are closely watched figures, especially leading up to the holiday season.

Retailer Jos. A. Bank rejected a $1.5 billion buyout offer from Men’s Wearhouse on Monday. The rivals have made offers to buy each other in recent months, only to be rejected by the other party.

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