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VOL. 38 | NO. 28 | Friday, July 11, 2014

US stocks drift as investors digest earnings

ALEX VEIGA, AP Business Writer

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Stocks were little changed in early trading Tuesday as investors sized up corporate earnings and new government data showing that retail sales inched up last month. Earnings from JPMorgan Chase and Goldman Sachs trumped Wall Street's expectations. Tobacco companies fell as investors got a look at the details of Reynolds American's takeover of rival Lorillard.

KEEPING SCORE: The Standard & Poor's 500 index fell a fraction of a point to 1,976 in the first 45 minutes of trading. The Dow Jones industrial average rose 16 points, or 0.1 percent, to 17,072. The Nasdaq composite fell 11 points, or 0.3 percent, to 4,428.

BANKS BEAT: Shares in JPMorgan Chase and Goldman Sachs surged after the investment banks reported better-than-expected financial results. JPMorgan, the nation's largest bank by assets, said second-quarter earnings fell 9 percent as revenue at its investment banking and mortgage businesses dropped. The stock gained $1.95, or 3.5 percent, to $58.23. Goldman's profit rose 5 percent, helped by record results from investment banking. Goldman gained $2, or 1.2 percent, to $169.

WHAT A DRAG: Cigarette maker Reynolds American said Tuesday it plans to buy rival Lorillard for about $25 billion in a deal to combine two of the nation's oldest and biggest tobacco companies. Reynolds fell $2.47, or 3.9 percent, to $60.71, while Lorillard sank $5.11, or 7.6 percent, to $62.11. Other tobacco stocks also declined: Altria Group slipped 75 cents, or 1.7 percent, to $42.60, while Philip Morris International fell $1.18, or 1.4 percent, to $84.77.

SECTOR WATCH: Six of the 10 sectors in the S&P 500 rose, led by financials. Consumer staples lagged the most.

SPENDING BAROMETER: The Commerce Department reported Tuesday that retail sales rose just 0.2 percent last month, held back by a sharp drop at building materials and garden supply stores. Sales also fell at restaurants and at auto dealers. The latest figures suggest that Americans are reluctant to spend freely, which could slow growth in the April-June quarter.

OVERSEAS MARKETS: European stocks were mixed. Germany's DAX fell 0.3 percent and Britain's FTSE 100 rose 0.8 percent. France's CAC-40 fell 0.6 percent. In Asia, Japan's Nikkei 225 rose 0.6 percent after a central bank policy meeting ended as expected with no changes to Tokyo's ultra-loose monetary policy. Hong Kong's Hang Seng gained 0.5 percent and South Korea's Kospi rose 0.9 percent.

BONDS & COMMODITIES: In the market for U.S. government bonds, the yield on the 10-year Treasury note was little changed at 2.55 percent. The price of oil slipped 1.2 percent to $99.69.

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BUILDING PERMITS 0 0 0
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