* Apple ends up 2.4 pct, boosts Nasdaq
* Buffett says stocks reasonably priced
* Dow down 0.03 pct, S&P 500 up 0.2 pct, Nasdaq up 0.4 pct
By Caroline Valetkevitch
NEW YORK, May 6 (Reuters) - The S&P 500 closed at another
record high, pushing further above 1,600 as financial shares led
the way after Bank of America's settlement with MBIA.
Apple's advance helped lift both the S&P and the Nasdaq.
Bank of America said it would settle claims with
MBIA for $1.6 billion, lifting shares of both companies
as well as the S&P financial sector Index, which gained
1 percent. MBIA shares jumped 45.4 percent to $14.29 and Bank of
America shares rose 5.2 percent to $12.88.
The day's gains followed a strong run in stocks since the
start of the year. Supportive monetary policies that have kept
interest rates low as well as solid earnings have helped to keep
the market up. The S&P 500 has gained 13.4 percent since Dec.
"As long as you continue to have decent earnings reports and
the support from central banks around the world providing
liquidity, it's going to be hard to derail this market, at least
in the short term," said Michael James, managing director of
equity trading at Wedbush Securities in Los Angeles.
Apple shares were also among the top gainers after
Barclays raised its price target on the stock. Apple shares shot
up 2.4 percent to $460.71, leading both the Nasdaq composite
index and the benchmark S&P 500 higher.
The Dow Jones industrial average dipped 5.07 points,
or 0.03 percent, to 14,968.89 at the close. But the Standard &
Poor's 500 Index inched up 3.08 points, or 0.19 percent,
to finish at a record 1,617.50. The Nasdaq Composite Index
gained 14.34 points, or 0.42 percent, to close at
During the session, the S&P 500 also reached an all-time
intraday high of 1,619.77.
Although weak economic data from the euro zone and China has
caused concerns over the global growth outlook, Friday's
stronger-than-expected U.S. payrolls report fueled the gains
that drove both the Dow and the S&P 500 to record levels.
Warren Buffett said on Monday that low interest rates have
made bonds "terrible" investments, but stocks are "reasonably
priced," and he continues to shy away from sectors such as
media, where he cannot predict which will thrive in the long
But some analysts suspect the rally has little strength to
keep going on.
The market "is discounting a tremendous amount of good news
now, which I don't think is going to be substantiated, and I
don't think it's allowing for any possibility of bad news," said
Uri Landesman, president of Platinum Partners in New York.
Earnings have been mostly higher than expected, with 68.5
percent of companies surpassing estimates so far. At the same
time, second-quarter estimates have fallen as outlooks remain
more negative than positive.
Among Monday's reports, Tyson Foods Inc posted a
weaker-than-expected quarterly profit and cut its full-year
sales forecast. Its shares declined 3.3 percent to $24.10.
In contrast, Humana Inc jumped 2.1 percent to $75.49
as one of the S&P 500's biggest percentage gainers. JPMorgan
upgraded the stock to "overweight."
But Johnson & Johnson shares slid 1.3 percent to
$84.68, weighing on the blue-chip Dow average.
GM's stock also declined. The U.S. Treasury said it will
begin another round of sales of General Motors stock
acquired during the government's bailout of the auto sector.
GM shares slipped 0.9 percent to $31.82.
Volume was roughly 5.3 billion shares traded on the New York
Stock Exchange, the Nasdaq and the NYSE MKT, below the average
daily closing volume of about 6.4 billion this year.
Advancers outpaced decliners on both the NYSE and the Nasdaq
by a ratio of about 3 to 2.