Stocks edge lower on Wall Street; Best Buy drops
NEW YORK (AP) - Apple, the most valuable company in the U.S., slumped Friday, dragging on the stock market. A lack of progress in federal budget talks also discouraged investors.
Apple's stock fell $20 to $510. The launch of the iPhone 5 in Beijing failed to draw the long lines of customers that showed up for previous versions of the iPhone, according to news reports. Analysts at UBS cut their earnings estimates and price target for Apple.
The Standard & Poor's 500 index fell three points to 1,416 while the tech-heavy Nasdaq composite fell 17 points to 2,975. Apple is the biggest stock in both indexes.
The Dow, which doesn't include Apple, gave up just seven points to 13,163.
President Barack Obama and House Speaker John Boehner met Thursday to discuss a budget deal to avoid the "fiscal cliff," a collection of higher taxes and government spending cuts scheduled to start Jan. 1. There were no signs of progress, and Boehner returned home to Ohio on Friday.
Investors remain confident the two sides will reach a deal soon, said Todd Morgan, a founder of Bel Air Investment Advisors in Los Angeles. But the more time it takes, the more anxious they get.
"People want to move ahead and get past this," Morgan said. "The uncertainty around it is what's making people nervous."
The Labor Department said a steep fall in gas prices pushed down a measure of consumer prices last month.The consumer price index edged down 0.3 percent in November from October. Gas prices sank 7.4 percent, the biggest drop in nearly four years. Consumer prices have risen 1.8 percent over the past year.
The report helped nudge up prices for U.S. government debt, pushing yields down. The yield on the 10-year Treasury note slipped to 1.71 percent, down from 1.73 percent late Thursday. When inflation is weak, it suggests that interest rates are unlikely to jump, and bond prices unlikely to drop, anytime soon.
Asian markets rose after HSBC said manufacturing in China is picking up. Its index for manufacturing December rose to 50.9, a slight increase from the previous month. Anything above 50 is a sign of growth.
Among other companies in the news:
- Adobe jumped 6 percent after the maker of Photoshop editing software and other applications reported results that beat analysts' expectations. More subscribers for its online Creative Cloud online service helped drive revenue and earnings up. Adobe's stock gained $2 to $37.53.
Best Buy sank 14 percent, losing $2 to $12.16. The struggling electronics retailer and one of its founders, Richard Schulze, agreed to give Schulze more time to assemble a bid for the company. That erased most of the gains made Thursday when Best Buy's stock jumped 16 percent following a report that said Schulze would make a bid by the end of the week.
- Silver Bay Realty Trust dipped 10 cents to $18.40 in its first day of trading. Silver Bay raised $245.1 million in its initial public offering Thursday. It plans on using the money to buy thousands of single-family homes and rent them out, as the U.S. housing market slowly heals.