* Freeport to buy Plains, McMoRan Exploration for $9 bln
* Citigroup to cut 11,000 jobs, take $1 billion charge
* Apple shares fall 4 percent
* Travelers leads Dow higher on Sandy estimate
* Dow up 1 pct, S&P up 0.5 pct, Nasdaq off 0.3 pct
By Chuck Mikolajczak
NEW YORK, Dec 5 U.S stocks advanced in a choppy
session on Wednesday as a rally in bank shares and The
Travelers, a Dow component, overshadowed Apple's unexpected drop
and weakness in the technology sector.
Equities staged a turnaround in the face of a drop in Apple
, the largest U.S. company by market capitalization and
a big weight in both the S&P 500 and the Nasdaq. Apple's stock
fell 4.2 percent to $551.74, after dropping as low as $545.56.
Market participants cited a host of reasons for the slide in
the iPad maker's stock, including a consultant's report about
the company losing share in the tablet market and reports that
margin requirements had been raised by at least one clearing
The S&P 500 reversed course after briefly falling below the
1,400 level, seen as a key support point over the past two
"There's still psychological interest in buying the market,"
said John Brady, managing director at R.J. O'Brien & Associates
"The S&P hit the 1,400 level so we find again 'dip buyers'
there. They strongly believe a deal (on the fiscal cliff) is
going to get done, and that's really the trade."
Investors have been reluctant to take big positions as
lawmakers continue to negotiate a deal to avoid a series of
mandatory spending cuts and tax increases effective in early
January - known as the "fiscal cliff" - that could push the U.S.
economy into recession next year.
President Barack Obama told the Business Roundtable, a group
of chief executives, that a "fiscal cliff" deal was possible
within about a week if Republicans acknowledged the need to
raise taxes on the wealthiest Americans.
For several weeks, the market has reacted quickly to
often-conflicting headlines out of Washington about budget
negotiations, prompting investors to be cautious.
The Dow Jones industrial average gained 123.74
points, or 0.96 percent, to 13,075.52. The Standard & Poor's 500
Index rose 6.92 points, or 0.49 percent, to 1,411.97. But
the Nasdaq Composite Index dropped 9.51 points, or 0.32
percent, to 2,987.17.
Banking shares were the best performers, led by a 6.4
percent climb in Citigroup to $36.48 after the company said it
will cut 11,000 jobs worldwide, or about 4 percent of its
workforce. The KBW Bank Index rose 2.1 percent.
Bank of America shares shot up 5.1 percent to $10.40
after hitting a new 52-week high at $10.44.
Shares of Freeport-McMoRan Copper & Gold Inc slumped
13.6 percent to $33.07. 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 82.7 percent to
$15.46 and Plains Exploration & Production shares surged 25.5
percent to $45.23.
Shares of The Travelers Cos Inc rose 4.7 percent to
$73.81 and ranked as the Dow's top gainer after the property and
casualty insurance company said its preliminary estimate of net
losses from Superstorm Sandy was about $650 million after tax.
Economic data from payrolls processor ADP showed U.S.
private-sector hiring took a hit in November due to the impact
of Superstorm Sandy, which ravaged consumers and businesses in
the Northeastern United States, but the huge services sector
kept expanding albeit at a modest pace, according to the
Institute for Supply Management.