US stocks open little changed
New York - US stocks were little changed as investors watched earnings before President Barack Obama’s State of the Union address.
Michael Kors rose 13 percent after raising its forecast in anticipation of a jump in same-store sales.
Avon Products jumped 12 percent as adjusted profit topped analysts’ estimates.
Goodyear Tire & Rubber fell 5 percent after providing a forecast that was below its prior estimate.
Facebook sank 1.6 percent as Sanford Bernstein cut its recommendation.
The Standard & Poor’s 500 Index fell less than 0.1 percent to 1,516.41 at 9:42 a.m. in New York.
The benchmark gauge reached its highest level since November 2007 on February 8, completing its longest streak of weekly gains since August.
The Dow Jones Industrial Average increased 2.17 points, or less than 0.1 percent, to 13,973.41 today.
Trading in S&P 500 companies was 26 percent below the 30-day average at this time of day.
“People are hesitant to make a move when there isn’t a clear trend, and certainly for the last few weeks there hasn’t been a clear trend,” Jordan Irving, who helps oversee $180 million at Irving Magee Investment Management LLC in Philadelphia, said in a phone interview.
“It feels almost like investors are waiting to see if there’s another bit of good news that can lead the next leg up.”
The S&P 500 has rallied 6.3 percent in 2013 as US lawmakers reached a budget compromise.
The gauge is about 3.1 percent below its record reached in October 2007.
It has more than doubled since bottoming in March 2009 as the Federal Reserve conducted three rounds of bond-buying to lower interest rates and boost economic growth.
Obama is due to deliver his State of the Union address at 9 p.m. in Washington.
He will make proposals for spending on infrastructure, clean energy and education, according to an administration official briefed on the speech.
Obama will argue that fostering economic growth remains the best strategy to narrow a federal budget gap that has exceeded $1 trillion in each of the last four years.
About 74 percent of the 354 companies in the S&P 500 that have released results during the earnings season have exceeded profit projections, and 66 percent have beaten sales estimates, data compiled by Bloomberg show.
“It’s earnings, which on balance there’s always some bad news with the good,” Timothy Holland, fund manager at Alexandria, Virginia-based TAMRO Capital Partners, which manages about $2 billion, said in a telephone interview.
“I’m encouraged by the sentiment toward the ongoing rally.”
Michael Kors, named for the designer who founded the company, increased 13 percent to $64.30.
Profit excluding certain items will be as much as $1.82 a share in the company’s fiscal 2013, compared with a previous estimate of as much as $1.50, Michael Kors said in a statement.
Analysts estimated $1.57 a share, according to the average of 14 projections compiled by Bloomberg.
Avon Products jumped 12 percent to $19.35. The world’s largest door-to-door cosmetics seller reported fourth-quarter adjusted profit that topped analysts’ estimates as new Chief Executive Officer Sheri McCoy trimmed costs.
Goodyear fell 5 percent to $13.22.
The largest US tiremaker reported lower fourth-quarter segment sales compared with a year earlier. The company announced that it would exit the farm tire business in Europe, Middle East and Africa, and close a plant in France.
Facebook declined 1.6 percent to $27.80.
Carlos Kirjner, an analyst at Bernstein in New York, downgraded the stock to market perform, the equivalent of hold, from outperform and cut his share-price estimate by 18 percent to $27.
“North American price-per-ad growth may still be strong in the first quarter and second quarter 2013, but could decline somewhat in in the third quarter, and steeply thereafter,” the analyst wrote in a report today.
“The situation is similar in western Europe, which together with North America accounts for roughly 70 percent of Facebook’s revenues.” - Bloomberg