Stocks Turn Mixed as Tech, Energy Slip

Stocks lost steam in late morning trading as techs and financials slipped despite news U.S. forces killed Osama Bin Laden.

The Dow Jones Industrial Average rose more than 20 points after ending April at multi-year highs.

Alcoa , Merck and American Express led blue-chips higher, while Microsoft fell.

The S&P 500 gained, while the Nasdaq slipped. The CBOE Volatility Index, widely considered the best gauge of fear in the market,rose above 15.

All key S&P 500 sectors advanced, led by health care, consumer discretionary and telecom gained.

U.S. crude slid more than 1 percent after the news, but prices have stabilized in morning trading. London Brent crude fell slightly below $126 a barrel, while U.S. light crude rose above $114.

The dollar shed earlier gains against a basket of currencies, while the price ofgold stabilizedabove $1,558, and silver fell nearly 5 percent to almost $46 an ounce.

In a late-night address on Sunday, President Obama said U.S. forces led an operation in which bin Laden was killed, and that "justice has been done."

While futures initially spiked on the news, the modest gains seen Monday are "more of the same," in terms of the market continuing a trend of climbing higher, said Dan McMahon, director of equity trading at Raymond James.

"The fact he has been brought to justice, sure, it’s a positive, it’s great for all parties involved, ....but in the grand scheme of things it’s a non event," McMahon said. "The markets are about earnings and the economy."

News of Bin Laden's death should be positive for stocks, however, said analysts at JPMorgan, as it will prompt more investors to buy into the market, JP Morgan analysts wrote in a note to clients.

That's because the death of al Qaeda's leader means there is less risk in the world, and consumer confidence should rise on news of a major U.S. victory, the analysts said. Also, "catastrophe" assets like commodities will be worth less than equities, further pushing inflows into stocks, they said.

"The death of Osama Bin Laden, in our view, will have durable positive effects on equity markets, persuading investors to diminish fears on global security (a strong case to be made that the war on terror is over), leading to lower equity risk premiums (read P/E of stocks go up)," the analysts wrote.

The markets are up considerably since Bin Laden's al Qaeda network struck at the World Trade Center on Sept. 11, 2001. The Dow is up nearly 34 percent, while the S&P 500 is up more than 25 percent, and the Nasdaq has gained more than 70 percent.

World leaders were happy to hear of Bin Laden's killing, although governments across the world are on alert for retaliatory attacks. The U.S. issued a worldwide travel alert citing the "enhanced potential for anti-American violence."

Over the weekend, Warren Buffett told Berkshire Hathaway shareholders he made "a big mistake" by not questioning David Sokol's "inexplicable and inexcusable" trades in Lubrizol, which violated the company's ethics code.

This week will be lighter for earnings results, but several companies will report results this week, including Anadarko Petroleum after the market closes Monday. Of the 328 companies reporting so far, or 66 percent of all S&P 500 companies, 72 percent have beaten earnings estimates while 68 percent have beaten revenue estimates, according to Thomson Reuters.

Humana gained after reporting a 22 percent rise in first quarter profits, ahead of expectations.


And Chrysler, managed by Italian car maker Fiat,reported a first-quarter profit of $116 million, it's first gain since emerging from bankruptcy two years ago. Chrysler lost $197 million a year ago. Revenue rose to $13.1 billion in the first quarter.

In merger and acquisitions news, the board of Danisco recommended shareholders to accept a raised offer fromDuPont, which late Friday made its cash offer worth $6.64 billion.

Also, Teva Pharmaceutical Industries gained after news it wouldbuy Cephalon, a specialty drugmaker for $81.50 a share or about $6.2 billion. Cephalon , which Valeant Pharmaceuticals International had sought to acquire in a hostile bid, also gained.

Arch Coal traded slightly higher after news it's buying International Coal Group for $3.4 billion in an all-cash deal that will create the largest supplier of metallurgical coal.

Research In Motion's announcement of two upgraded BlackBerry Bold smartphones didn't do much to reverse the slide in the company's stock, which fell sharply last week after delivering disappointing earnings results.

Alcoa got a boost from Goldman Sachs, which upgraded the aluminum producer to "buy" from "neutral." The brokerage also raised its price target on the stock to $22 a share from $17.

In economic news, the Institute for Supply Management'sApril gauge of manufacturing fell less than expected to 60.4 from 61.2 in March. The prices paid index within the report rose to 85.5 from 85, the highest level in nearly three years.

Also construction spending gained 1.4 percent in April to an annual rate of $768.9 billion, according to the Commerce Department, widely exceeding expectations.

Asian stocks rallied, with the Nikkei briefly jumping above 10,000 points, while European shares traded higher.

Various markets in Asia and Europe are closed. Financial markets in China, Hong Kong, Singapore, Malaysia and Thailand are all shut for public holidays while the London Stock Exchange is also closed.

On Tap This Week:

MONDAY: Boeing shareholder meeting, first GOP Presidential debate, RIM capital markets day, Sirius XM Radio antitrust case; earnings from Anadarko, Chesapeake and Massey Energy.
TUESDAY: Factory orders, auto sales, Bristol-Myers shareholder meeting, Nokia annual meeting, Wells Fargo shareholder meeting; earnings before-the-bell from Pfizer, Clorox, NYSE Euronext, and MasterCard, and after-the-bell from Comcast and CBS.
WEDNESDAY: Weekly mortgage applications, Challenger job-cut report, Fed's Rosengren speaks, ADP employment report, ISM non-manufacturing index, oil inventories, Fed's Lockhart speaks; earnings before-the-bell from Anheuser-Busch, AOL, Kellogg, and Time Warner, and after-the-bell from Electronic Arts, MetLife, News Corp, Transocean and Whole Foods.
THURSDAY: Bank of England rate announcement, European Central Bank announcement, chain store sales, jobless claims, productivity and costs, Treasury STRIPS, money supply; Fed Chairman Bernanke speaks, Fed's Kocherlakota speaks, UPS shareholder meeting, Verizon shareholder meeting; earnings before-the-bell from GM, Cigna, CVS Caremark and after-the-bell from AIG, Kraft and Visa.
FRIDAY: Non-farm payroll report, consumer credit, Alcoa shareholder meeting, flash crash anniversary; earnings before-the-bell from Constellation Energy and tentatively after-the-bell from Berkshire Hathaway.

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