A strong earnings report from Intel boosted US blue-chip stocks on Wednesday, extending the Dow Jones Industrial Average's winning streak to seven sessions.
Still, the Dow's gain was slim and the broader Standard & Poor's 500 index snapped a six-day streak as optimism over the pace of corporate earnings gave way to a chilly economic forecast from the Federal Reserve.
The Dow, which climbed 3.7 points (0.04%) to 10,366.72, was led by its technology components after chip maker Intel posted the strongest quarterly results in its 42-year history. The Dow hasn't had such a long positive run since March.
The retail sales data weighed on Home Depot, which was the Dow's weakest component with a drop of 36 cents, or 1.3%, to 28.28.
Intel's results were seen as proof that businesses have joined consumers in snapping up new computers, and the numbers provided a big boost to other technology stocks. Intel climbed 35 cents (1.7%) to $21.36; Cisco Systems advanced 65 cents (2.8%) to $23.74; Microsoft advanced 31 cents (1.2%) to $25.44; and Hewlett-Packard climbed 57 cents (1.2%) to $47.34.
The technology-heavy Nasdaq Composite gained 7.81 (0.35%) to 2,249.84, marking its seventh straight session in the black.
The S&P 500 slipped 0.17 (0.02%) to 1,095.17, narrowly missing its chance to set the measure's longest winning streak since October 2006.
While the index's technology sector was strong, its financial sector slumped as investors grew cautious ahead of earnings reports due from big banks later this week. JP Morgan is set to release its second-quarter results on Thursday and Citigroup and Bank of America will follow with theirs on Friday. JP Morgan declined 13 cents (0.3%) to $40.35 and Citigroup shed 9 cents (2.1%) to $4.21, although Bank of America ended flat at $15.67.
ASML Holding climbed 67 cents (2.1%) to $31.94. The Dutch semiconductor-equipment maker said it will ramp up production in anticipation of a record year for sales after its second-quarter earnings beat expectations.
Expeditors International of Washington jumped $2.48 (6.7%) to $39.64, after the freight forwarder predicted its second-quarter earnings will beat expectations because of large increases in both air- and ocean-freight volume.
Motorola advanced 25 cents (3.5%) to $7.46, after it was reported that Nokia Siemens Networks is in talks to buy Motorola's telecom-equipment arm, according to people familiar with the matter. Also providing a boost, a broker boosted its investment rating on Motorola's shares to neutral from sell, saying the company is likely to benefit from its rivals' woes.
Northrop Grumman climbed $1.73 (3.1%) to $56.99. The defence contractor said it plans to consolidate its Gulf Coast shipbuilding operations at its Pascagoula, Miss., plant and has hired advisers to explore options for that business. The company said it will take a $113m second-quarter charge related to the consolidation.
Yum Brands slipped 50 cents (1.2%) to $41. The fast-food company's second-quarter earnings fell 5.6% after a large prior-year gain, and while the company boosted it profit projection for the year, its new view was shy of Wall Street's expectations.
For Australian ADRs listed on the NYSE, BHP Billiton declined 5 cents (0.07%) to US$67.17, Rio Tinto Plc increased 3 cents (0.06%) to US$47.58, ResMed increased 58 cents (0.88%) to US$66.81, Telstra Corporation firmed 7 cents (0.49%) to US$14.45, Telecom Corporation of NZ slid 4 cents (0.57%) to US$7.02 and Westpac added 35 cents (0.35%) to US$99.95.
In economic news, Fed policy makers trimmed their economic growth forecasts at last month's policy meeting and raised the prospect of further monetary stimulus if the economy showed more serious signs of slowing. Fed officials lowered GDP growth estimates for this year to 3%-3.5%.
US retail sales fell 0.5% in June as a tough labour market continues to weigh on consumer spending. June import prices plunged 1.3%, the largest monthly drop in more than a year, while business inventories rose more than expected.
At 7:45 AM (AEST), the 10-year Treasury note yield was 3.04% and the five year yield was 1.81%.
European shares snapped a six-session advance on Wednesday, as mining and automotive losses offset earnings-related gains in the technology sector.
After having moved as high as 257.03 earlier in the session, the Stoxx Europe 600 index ended nearly unchanged, down only seven points, to 255.92.
Miners, sensitive to economic trends, led the pullback in Europe, with Xstrata shares down 1.3%, while autos pared some sharp gains made on Tuesday after BMW Group lifted its outlook. Shares of BMW declined 1.4% as Renault gave up 0.6%.
Among the major regional benchmarks, the French CAC-40 index dropped 0.1% to 3,632.98 and the UK's FTSE 100 index fell 0.3% to 5,253.52.
The German DAX index, meanwhile, added 0.3% to 6,209.76.
Technology shares traded firm through the session, ASML shares rallied 3.1%, with STMicroelectronics moving up 2.3% and Infineon Technology adding 2.4%.
Also advancing, London Stock Exchange shares rose 3.6%. The firm reported a 1% rise in first-quarter revenue and said its market share of the trading in UK stocks improved in June after it lowered transaction fees.
However, shares of interdealer-broker Icap dropped 4.6%. The company announced a 5% rise in quarterly profit and 8% revenue growth but said that trading levels "slowed significantly" in June as customers' risk appetite declined.
Banks were also under pressure, with Societe Generale shares sliding 2.2% and BBVA losing 0.7%.
Shares of Credit Suisse fell 0.6%. German prosecutors searched 13 of the lender's offices as part of a probe into whether bank employees may have helped clients evade taxes.
BP shares fell 2.3% with the oil giant taking a go-slow approach in how it's conducting a pressure integrity test of the Macondo well, which has been spilling oil into the Gulf of Mexico for nearly three months.
On the FTSE 100, Rio Tinto slipped 50 pence (0.02%) to 3,153.30 pence and BHP Billiton weakened 10.00 pence (0.54%) to 1,846.00 pence.
Asian markets climbed as Intel's strongest-ever quarterly results buoyed technology sector shares, while a robust economic picture in Singapore also aided sentiment.
Japan's Nikkei Stock Average added 2.7%, Hong Kong's Hang Seng Index rose 0.6% and China's Shanghai Composite gained 0.8%.
New Zealand shares ended higher on Wednesday, tracking positive offshore leads as investors were cheered by chip-maker Intel's strong quarterly result after Wall Street closed. The benchmark NZX-50 ended 0.6%, or 19 points, higher at 3,027.44.
Base metals had a lower finish on the London Metal Exchange after a day of choppy trading during which many market participants remained on the sidelines. Aluminium fell $5 (0.25%) to $1,990 while copper weakened $20 (0.30%) to $6,645 and nickel dropped $155 (0.80%) to $19,320. Zinc shed $25 (1.35%) to $1,830 and lead lost $15 (0.82%) to $1,810. Comex copper was last quoted at 300.35 US cents per pound.
Gold futures fell slightly as equities and currency markets were stable, leaving little demand for gold as a rainy-day asset. Spot gold was last quoted at $1,207.25. Comex gold futures slid $6.50 (0.54%) to $1,207.00. Spot silver was last quoted at $18.24.
Crude settled lower as the US Federal Reserve rolled back its outlook for economic growth. West Texas Intermediate was last quoted at US$77.04 per barrel.
At 07:45 a.m. (AET) the US dollar was quoted at 0.7851 euros, 88.43 yen, 1.132 AUD and 65.51 pence.