* Freeport to buy Plains, McMoRan Exploration for $9 bln
* Citigroup to cut 11,000 jobs, take $1-billion charge
* Apple shares fall more than 4 percent
* Dow flat, S&P off 0.4 pct, Nasdaq off 1 pct
By Angela Moon
NEW YORK, Dec 5 An unexpected decline in shares
of Apple Inc led U.S. stocks lower on Wednesday, as the tech
giant dropped nearly 5 percent in heavy trading.
Investors have been reluctant to take big positions as
lawmakers continue to negotiate a deal to avoid a series of
spending cuts and tax increases effective next year - known as
the "fiscal cliff" - that could push the U.S. economy into
recession next year.
Apple shares were down at $546.70 and accounted for
more than half of the Nasdaq 100's 1.5 percent selloff. Market
participants cited a consultancy's report about the company
losing share in the tablet market and reports that margin
requirements had been raised by at least one clearing firm.
"It's Apple that is dragging the whole market down for
today," said Tim Ghriskey, chief investment officer at Solaris
Later in the day, President Obama will renew his case for
tax hikes and call for a smooth increase in the nation's
borrowing limit in a speech to the Business Roundtable group of
For several weeks, the market has reacted quickly to
often-conflicting headlines out of Washington about ongoing
budget negotiations, prompting investors to be cautious.
The Dow Jones industrial average was up 0.04 points,
or 0.00 percent, at 12,951.82. The Standard & Poor's 500 Index
was down 6.02 points, or 0.43 percent, at 1,401.03. The
Nasdaq Composite Index was down 32.52 points, or 1.09
percent, at 2,964.17.
Banking shares gained, with the KBX Bank index adding
0.7 percent to 48.16.
Citigroup Inc shares rose 4 percent to $35.64 after
saying it will cut 11,000 jobs, or 4 percent of its work force -
its first major move to restructure since the departure of
former chief executive officer Vikram Pandit.
Bank of America shares hit a new 52-week high,
rising more than 3 percent to $10.23.
Shares of Freeport-McMoRan Copper & Gold Inc slumped
13 percent to $32.23. The company said it is acquiring Plains
Exploration & Production Co and McMoRan Exploration Co
in two separate deals for $9 billion in cash and stock
in a major expansion into energy.
But shares of McMoRan Exploration soared 75 percent to
$14.81 and Plains Exploration & Production shares also jumped,
by 24 percent to $44.59.
Weighing on market sentiment, data showed U.S.
private-sector employers added 118,000 jobs in November, shy of
U.S. factory orders rose for second straight month in
October, and the service sector grew in November, separate data
showed, but market reaction was muted.
Global shares rose after Chinese Communist Party chief Xi
Jinping said the country would maintain its fine-tuning of
economic policies in 2013 to ensure stable economic growth.
Among his key priorities, Xi listed tax reform, urbanization and
allowing the market to play a bigger role in setting resource