US close: Dow breaches 22,000 as Apple hits record high
US stocks ended mostly higher on Wednesday, with the Dow outperforming and breaching the 22,000 level for the first time as Apple shares hit a record high on the back of well-received earnings.
The Dow Jones Industrial Average closed up 0.2% at 22,016.24, while the S&P 500 nudged up 0.1% to 2,477.57 and the Nasdaq closed flat at 6,362.65.
Shares in tech giant Apple rose 4.7% to a record high after the company’s third-quarter earnings topped estimates. It reported adjusted earnings per share of $1.67 versus estimates of $1.57 and revenue of $45.4bn compared with expectations of $44.89bn.
CMC Markets analyst Colin Cieszynski said: “It has been a good news, bad news kind of day for trading in world markets. The good news is that the Dow broke through 22,000 to a new all-time high. The bad news is that despite a number of positive earnings reports from companies including Apple, Garmin and Allstate which sent their shares up 5%, 4% and 3% respectively, the S&P and Nasdaq were unable to confirm the Dow and instead traded flat to lower through much of the day.
“This action suggests that the bull market which started back in November, plus the recent advance that has seen the Dow rally for eight straight days, may be near exhaustion as we head toward the weakest time of the year for stocks.”
Match Group was up 4% despite posting disappointing second-quarter results, while Garmin was 4.5% firmer after reporting a better-than-expected quarterly profit.
Allstate shares gained after the company said its profit nearly doubled in the second quarter.
On the downside, shares of AMC Entertainment crashed 27% after the company issued a warning on its second quarter earnings.
Auto Nation was down 7.2% after the car dealer posted lower-than-expected third-quarter earnings per share of 86 cents.
Cardinal Health declined 8.2% after offering downbeat guidance for its earnings per share in 2018.
On the economic front, private sector payrolls increased by 178,000 in July, ADP's monthly survey showed.
That was less than the 195,000 gain which economists had projected; however, an upwards revision to June's reading from 158,000 to 191,000 meant Wednesday's report was in fact stronger-than-expected.
Mark Zandi, chief economist of Moody’s Analytics, said, "The American job machine continues to operate in high gear. Job gains are broad-based across industries and company sizes, with only manufacturers reducing their payrolls. At this pace of job growth, unemployment will continue to quickly decline."