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US STOCKS-Wall Street up on Spain optimism, Apple scales new peak
September 21, 2012 / 3:00 PM / in 5 years

US STOCKS-Wall Street up on Spain optimism, Apple scales new peak

* Apple’s new iPhone hits world, shares at peak

* Kors boosts guidance, shares up

* Vivus drops on obesity drug outlook

* Indexes up: Dow 0.3 pct, S&P 0.4, Nasdaq 0.6 pts

By Chuck Mikolajczak

NEW YORK, Sept 21 (Reuters) - U.S. stocks opened higher on Friday as Spain moved toward reform measures in anticipation of a bailout package and as Apple debuted its latest iPhone worldwide, sending its shares up to a new peak.

Spain is considering freezing pensions and speeding up a planned rise in the retirement age as it races to cut spending and meet conditions of an expected international sovereign aid package, sources with knowledge of the matter said.

The country’s deputy prime minister later denied the government was mulling the freezing of pensions and the German finance minister said the country did not need a sovereign bailout on top of the package already agreed for its banks.

“There is that news out of Europe, where they seem to be making more progress towards helping Spain out, so that is going to continue to kind of support us, for sure,” said Ken Polcari, Managing Director at ICAP Equities in New York.

After gaining about 6 percent since the start of August on expectations for new economic stimulus measures by world central banks, the S&P 500 has seen muted action this week, barely moving 0.4 percent in either direction daily.

There may be increased volatility towards the close Friday due to ‘quadruple witching’ - the quarterly settlement and expiration of four different types of September e q uity futures and options contracts. Expiration can lead to greater volume and volatility as players adjust or exercise their derivative positions.

“The option expiry is going to create this massive volume - as it did on the opening - at the close,” said Polcari.

The Dow Jones industrial average gained 35.00 points, or 0.26 percent, to 13,631.93. The Standard & Poor’s 500 Index rose 5.31 points, or 0.36 percent, to 1,465.57. The Nasdaq Composite Index advanced 17.33 points, or 0.55 percent, to 3,193.29.

Apple Inc climbed 0.9 percent to $704.80, after earlier hitting an all-time high of $704.85. The company’s iPhone 5 hit stores around the world, giving the consumer giant a boost ahead of the crucial end-of-year holiday season, even as rival Samsung Electronics Co steps up its legal challenge over key technologies.

Housing shares advanced, led by an 8.8 percent jump in KB Home to $14.27 after the fifth-largest U.S. homebuilder posted a surprise quarterly profit and said its revenue backlog rose to a four-year high. The PHLX housing sector index climbed 2 percent.

Oracle Corp added 0.9 percent to $32.54 after the software maker’s first-quarter met Wall Street expectations, and though the company hardware sales are expected to drop further after tumbling 24 percent from a year ago..

Michael Kors Holdings Ltd surged 6.4 percent to $55.85 after the company said it will likely earn more than it expected in the second quarter as the fashion and accessory designer banks on strong global sales.

Darden Restaurants Inc posted first-quarter earnings that beat analysts’ estimates, and the company stood by its sales and profit forecast for the year. Shares rose 4.5 percent to $57.18.

Vivus Inc plunged 11 percent to $21.11 after the company said it expects a European committee to recommend against the approval of its obesity drug Qsiva, based on preliminary feedback from the committee.

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