US stocks: Apple soars above falling markets

NEW YORK - US stocks ended the first week of 2005 lower on Friday as widely watched jobs data failed to excite investors by coming in close to expectations, but a strong showing by Apple Computer Inc. helped limit losses on the Nasdaq.

Apple surged 7 per cent, or US$4.70, to US$69.25 on hopes that the maker of the popular iPod music device will report good results on Wednesday. The stock also benefited from First Albany Capital's raising its earnings estimates for Apple.

Chip maker Intel Corp., a Dow component that trades on Nasdaq, rose 1.5 per cent, or 34 cents to US$22.80 before it reports results on Tuesday.

But overall, the wider market was lacklustre as investors ended the first week of 2005 in cautious mode.

The Dow Jones industrial average was down 18.92 points, or 0.18 per cent, at 10,603.96. The Standard & Poor's 500 Index was down 1.70 points, or 0.14 per cent, at 1,186.19. The Nasdaq Composite Index was down 1.39 points, or 0.07 per cent, at 2,088.61.

All three indexes ended the year's first week lower, which hasn't happened since 2001. Nasdaq's 6-day string of declines was its longest since the first week of August 2003.

Nasdaq ended the week down 4 per cent, the S&P ended down 2.1 per cent and the Dow ended off 1.7 per cent.

The first five days of the year are an "early warning" system for the year, according to the Stock Trader's Almanac. It said in eight of the past 13 post-election years, the S&P posted a loss for this period, and six of those were followed by full-year losses.

The main focus of Friday's trading was December's jobs data, which caused a mixed reaction.

The Labor Department said US employers added 157,000 new jobs to their payrolls -- not too far off economists' expectations of 175,000 jobs. The year 2004 was the strongest year for job growth since 1999. The December figures eased concerns that the Federal Reserve will be aggressive in its pace of interest rate hikes.

"The jobs number was less than expected, but it still ended up for the year, and I think that was viewed very positively," said Brian Williamson, vice president of equity trading at the Boston Co. Asset Management

"But then you have to turn that into -- what the Fed is going to do and how fast they're going to do it. December's figure may be some help for The Street in terms of how aggressive the Fed can be at this point."

The market was also awaiting earnings season -- which kicks off next week. "Maybe the market can reverse its fortune if it likes what it sees," said Williamson. "There's a lot of hesitation out there right now."

Weighing on the market were energy-related stocks, including Exxon Mobil Corp., down 33 cents at US$49.79, and ConocoPhillips, 54 cents lower at US$84.86.

US crude for February delivery settled 13 cents lower at US$45.43 a barrel.

Trucking companies such as CNF Inc. and Overnite Inc. fell after Morgan Stanley downgraded a number of companies in the sector. CNF fell US$1.01 to US$47.62 while Overnite fell 82 cents to US$35.29.

Retailers were also in focus, a day after a slew of companies reported holiday spending data. On Friday, luxury jeweller Tiffany & Co. jumped 4.6 per cent to US$31.70 after reporting a 12 per cent jump in holiday sales on Friday.

Stun gun maker Taser International Inc. plunged nearly 18 per cent, or US$4.90 to US$22.72 after saying the US Securities and Exchange Commission has begun an informal inquiry centred on company statements about the safety of its products.

Overall, trading was active, with 1.5 billion shares changing hands on the New York Stock Exchange, just above the 1.46 billion daily average for last year. About 2.2 billion shares were traded on Nasdaq, above the 1.81 billion daily average last year. Stocks that declined outnumbered those on the rise by about 4-to-3 on the NYSE. Declining issues outpaced advancers by about 3-to-2 on Nasdaq.

- REUTERS