(Corrects Apple share price in paragraph five)
* Apple, Amazon earnings disappoint
* Arch Coal surges after results
* UMich at 5-year high
* Indexes: Dow off 0.05 pct, S&P off 0.05 pct, Nasdaq up
By Chuck Mikolajczak
NEW YORK, Oct 26 (Reuters) - U.S. stocks were little changed
on Friday, after data showed the economy grew at a faster pace
than expected, overshadowing recent concerns about a
disappointing earnings season so far.
Investor sentiment got a boost after the Commerce Department
said U.S. gross domestic product expanded at a 2.0 percent
annual rate. That follows 1.3 percent growth in the second
quarter, and was just a tick above the 1.9 percent estimate of
analysts polled by Reuters.
Still, the positive data may not be enough to stem a recent
slide in the market, which has seen the S&P drop 3.7 percent
from near five-year highs on Sept. 14.
"The fact that this was a two percent GDP number is still
pathetic in the overall scheme of life - we ought to be growing
at four percent, not two percent," said Phil Orlando, chief
equity market strategist, at Federated Investors, in New York.
Apple Inc, slipped 1.2 percent to $602.15 after the
world's largest publicly-traded company by market capitalization
reported a second straight quarter of disappointing results and
iPad sales fell well short of analysts' targets. The company
also forecast revenue and margins below Wall Street forecasts.
But Amazon.com Inc climbed 4.4 percent to $241.96
after reporting its first quarterly net loss in more than five
years as it spent heavily on technology, infrastructure and
digital content, as analysts said it would boost profit in the
The S&P 500 has dropped 1.8 percent this week as dismal
corporate earnings and cautious outlooks, especially from large
multinationals, painted a pessimistic picture of the global
Adding to uncertainty was the impending U.S. presidential
election on Nov. 6, which, along with earnings and growth
worries, helped drop the benchmark S&P index to below a key
support level, the 50-day moving average, at around 1,434.
Many analysts expect the retreat to wane near 1,400 or
1,375, as the Federal Reserve's latest stimulus policy puts a
floor under equity prices.
With 244 companies in the S&P 500 having reported through
Thursday, 62.3 percent have beaten earnings expectations, a tad
better than the typical 62 percent average, Thomson Reuters data
Revenue for the quarter has been more disappointing, with
just 36.3 percent of companies reporting higher-than-expected
revenue - compared with a historic beat rate of 62 percent.
The Dow Jones industrial average dropped 5.99 points,
or 0.05 percent, to 13,097.69. The Standard & Poor's 500 Index
shed 0.73 points, or 0.05 percent, to 1,412.24. The
Nasdaq Composite Index gained 5.55 points, or 0.19
percent, to 2,991.67.
In what may bode well for consumer-related profits in the
latter portion of the current earnings season, a survey showed
U.S. consumer sentiment rose to its highest in five years in
October as Americans were more upbeat about prospects for the
economy and their own finances.
Goodyear Tire & Rubber Co slumped 7.6 percent to
$11.36 after it said quarterly profit fell amid lower tire sales
in all its key markets, particularly in Europe.
Dow component Merck & Co Inc edged up 0.5 percent to
$46.54 after the drugmaker reported better-than-expected
third-quarter profit, though overall sales came in slightly
below Wall Street expectations.
Newell Rubbermaid Inc reported a
higher-than-expected quarterly profit and raised its quarterly
dividend by 50 percent to 15 cents a share but also said it
would cut about 2,000 jobs over the next 2 1/2 years as it
attempts to combat slower sales. Its shares climbed 4.5 percent
Arch Coal Inc surged 13.5 percent to $8.30 after
surprising Wall Street with a third-quarter profit as cost cuts
paid off, and thermal coal shipments improved.
(Editing by Bernadette Baum and Kenneth Barry)