Apple Earnings Push Stock Market to New Record High
NEW YORK (AP) -- A big gain from Apple Wednesday morning (Aug. 2) sent the Dow Jones industrial average above 22,000 for the first time. Most other industries were trading lower, with health care and household goods companies slipping. Movie theater companies plunged after AMC Entertainment gave a weak forecast and said it will cut costs.
KEEPING SCORE: The Dow, which tracks 30 big-name U.S. companies, climbed 29 points, or 0.1 percent, to 21,992 as of 10:42 a.m. Eastern time. It traded above 22,000 points earlier.
The Standard & Poor's 500 index, a much broader market measure used by most professional investors, fell six points, or 0.3 percent, to 2,469. The Nasdaq composite lost 27 points, or 0.4 percent, to 6,336. The Russell 2000 index of smaller-company stocks shed 15 points, or 1.1 percent, to 1,412.
Two stocks fell for every one that rose on the New York Stock Exchange.
APPLE GETS AN 'A': Apple's fiscal third-quarter profit and sales were better than experts had anticipated. The company is forecasting $49 billion to $52 billion in revenue for the current quarter, which ends in September. That was also above estimates, and it's better than last year, when the iPhone 7 was released. Some experts feared that delays for the next iPhone model would cause Apple would forecast far lower sales. The stock climbed $8.35, or 5.6 percent, to $158.40.
As reported yesterday (Aug. 1), Apple posted a seven percent year-over-year revenue gain for the quarter ended July 1, bringing in $45.2 billion in the period. That growth was largely driven by high-percentage increases in its "Other Products" (which includes Apple Watch and Apple TV), which grew 23 percent year-over-year, and "Services" divisions (which includes Apple Music, iTunes and the App Store as well as Apple Pay and AppleCare), which was up 22 percent over the same period last year. Apple doesn't break out revenue statistics within its divisions, but Services overall brought in $7.266 billion, up from $5.98 billion in the third quarter 2016, an all-time record for the company's Services.
During a conference call following the release of its earnings report, Apple executives also provided more details about its HomePod smart speaker, with which it hopes to compete with Amazon's Alexa and Google's Google Home.