(Bloomberg) – U.S. stocks fluctuated, after the Dow Jones Industrial Average closed at a record yesterday, as rallies in Microsoft Corp. and UnitedHealth Group Inc. offset sanctions against Russia and a slump in housing starts.
Microsoft gained 3 percent after saying it will eliminate as many as 18,000 jobs, the largest round of cuts in its history. UnitedHealth jumped 2.2 percent as earnings topped forecasts. SanDisk Corp. dropped 11 percent after posting profit margins and sales forecasts that fell short of some analysts’ estimates.
The Standard & Poor’s 500 Index fell 0.1 percent to 1,979.21 at 10 a.m. in New York, trimming an earlier drop of 0.4 percent. The Dow slipped 3.76 points, or less than 0.1 percent, to 17,134.44. Trading in S&P 500 companies was 27 percent above the 30-day average for this time of day.
“We’re going to see just a grind higher,” Chris Hyzy, chief investment officer of U.S. Trust in New York, which oversees $325 billion, said in a phone interview. “Any pullback is a buying opportunity for at least a 12-18 month outlook.”
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The S&P 500 has rallied 7 percent this year amid better- than-estimated corporate earnings and central bank stimulus. The U.S. economy is showing signs of recovering from a 2.9 percent contraction in the first quarter. The benchmark index increased 0.4 percent yesterday as companies from Time Warner Inc. to Intel Corp. rallied amid deals and better-than-forecast earnings.
A total of 24 companies on the S&P 500 report earnings today, including Google Inc. and Schlumberger Ltd. Profit by the gauge’s members increased 4.5 percent in the second quarter, and revenue rose 3.1 percent, according to analysts’ estimates compiled by Bloomberg.
“Over the next week or two it won’t be the economic data points that drive things but the tone of earnings season,” said Michael O’Brien, fund manager at TD Asset Management Inc. in Toronto. His firm manages about C$248 billion. “If you get a strong earnings season, people won’t worry so much about where valuations are.”