Wall Street rallies late, ends flat

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks rebounded late on Monday to end flat, shrugging off lighter-than-expected sales from McDonald's (MCD.N) and lowered iPhone prices from Apple (AAPL.O).

The three major U.S. stock indexes had fallen more than 1 percent before rallying in the last hour of trading, led by bank shares.

Analysts pointed to the S&P 500's recent piercing of its 200-day moving average as a positive sign, giving investors confidence to buy stocks on dips in the market.

"What we're seeing is investors, both institutional and individuals, looking at dips as an opportunity to buy," said Bucky Hellwig, senior vice president at Morgan Asset Management in Birmingham, Alabama.

"It's a sign of the broader strength that's in the market."

The S&P 500 has rallied 39 percent since hitting a 12-year closing low on March 9, leading analysts to speculate a correction was looming, although recent dips have been short-lived.

"The market has been in an uptrend and ever since we broke through that 200-day moving average, the market has been acting pretty well," said Todd Leone, head of listed trading at Cowen & Co. in New York.

"You're still seeing buyers out there."

The Dow Jones industrial average .DJI gained 1.36 points, or 0.02 percent, to 8,764.49. The Standard & Poor's 500 Index .SPX dropped 0.95 of a point, or 0.10 percent, to 939.14. The Nasdaq Composite Index .IXIC dropped 7.02 points, or 0.38 percent, to 1,842.40.

TEXAS INSTRUMENTS LEAPS AFTER BELL

After the closing bell, shares of Texas Instruments Inc (TXN.N) jumped 5.2 percent to $20.80 after the chip supplier raised its earnings per share and revenue outlook for the second-quarter.

Financial stocks led the rebound, with JP Morgan Chase & Co(JPM.N) up 2.4 percent at $35.39. The big U.S. banking company's stock gave the biggest lift to the Dow as investors awaited news from Federal Reserve and Treasury officials, who are expected to announce which banks will be allowed to repay TARP money soon. The KBW Bank index .BKX added 1.3 percent.

McDonald's (MCD.N) was the blue-chip Dow's primary laggard

after the world's largest hamburger chain said May sales at U.S. restaurants open at least 13 months rose 2.8 percent, but were significantly less than the 6.1 percent growth in the previous month. [ID:nN08309089]. The stock lost 1.9 percent to $58.72.

Apple (AAPL.O) shares slid 0.6 percent to $143.85. The stock was the heaviest weight on the Nasdaq after the company cut the price on its base model 8-gibabyte iPhone. Earlier, Apple unveiled a cheaper Mac notebook at its annual developers' conference.