US STOCKS-Wall St bounces back with all eyes on Boston

Fri Apr 19, 2013 10:56am EDT

* Boston in virtual lockdown, trading volume could fall

* IBM shares down, Google up after results

* McDonald's profit up, shares off as U.S. sales drop

* Dow off 0.3 pct, S&P up 0.5 pct, Nasdaq up 0.9 pct

By Rodrigo Campos

NEW YORK, April 19 (Reuters) - Most U.S. stocks edged higher on Friday, bouncing back a day after the S&P 500 index closed below its 50-day moving average for the first time this year, but a sharp drop in IBM shares kept the Dow in the red.

Trading volume could see a decline as much of Boston, a major U.S. financial center and home to a number of the country's biggest mutual fund companies, was under virtual lock-down after police killed one suspect in the Boston Marathon bombing in a shootout and mounted house-to-house searches for a second man.

"Most major news networks are talking about what's going on in Boston than anything else," said Art Hogan, managing director at Lazard Capital, over the phone from Boston. "That tends to shift investor focus toward this than anything else in the market."

Hogan, who got to work early in the morning, described uncommonly empty streets and offices partially staffed as transportation is shut down in the city and parents stay home to take care of their kids, with schools shut down.

"The city is very much a ghost town right now," he said soon after the market opened.

Meanwhile, on Wall Street, markets partially recovered from a 3 percent decline on the S&P 500 over the previous four sessions, that set it on track to post its worst week since June.

IBM Corp led declines in the Dow a day after it posted an earnings miss, while less-than-stellar numbers from General Electric and MacDonald's Friday weighed further on the blue-chips.

The Dow Jones industrial average fell 53.45 points or 0.37 percent, to 14,483.69, the S&P 500 gained 5.99 points or 0.39 percent, to 1,547.6 and the Nasdaq Composite added 26.63 points or 0.84 percent, to 3,192.99.

The S&P 500's close below the 50-day moving average on Thursday indicates the medium-term uptrend in the market could be in peril. The last time the index closed consecutive days under its 50-day average came in early December.

IBM posted quarterly earnings that missed estimates due to the depreciation of the Japanese yen and a failure to close major deals, especially in Europe and the United States. The stock was down 7.2 percent at $192.32.

GE shares fell 3.9 percent to $21.78 after the conglomerate reported a quarterly profit in line with expectations as GE sold more jet engines and shed its stake in NBC Universal.

McDonald's fell 2 percent to $99.91 after it reported a first-quarter profit that fell short of Wall Street's expectations and said sales at established U.S. restaurants fell 1.2 percent.

Google's core Internet business increased net revenue 23 percent in the first quarter, softening the effect of a sharp decline in its Motorola mobile phone division. Its shares were up 2.6 percent at $785.98.

Vertex Pharmaceuticals said Thursday an experimental drug improved lung function in adults with cystic fibrosis in a midstage trial. Its shares were up 61 percent to $85.

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