* Dow, S&P 500 hit intraday record highs
* Homebuilders rally; Keurig up on Coke's plan to raise
* Cisco falls 1 percent, weighs on the Nasdaq
* Dow up 0.2 pct; S&P 500 up 0.1 pct; Nasdaq off 0.1 pct
(Updates to late afternoon)
By Caroline Valetkevitch
NEW YORK, May 13 The Dow and the S&P 500 edged
up on Tuesday, with the S&P 500 briefly rising above 1,900 for
the first time, while the Nasdaq pulled back after recent gains.
Both the Dow and the S&P 500 hit record intraday highs and
then retraced some ground, holding slim gains in afternoon
trading. In contrast, the Russell 2000 index of small-cap
stocks was down 0.8 percent.
"Technically new highs are usually a bullish event, but
we're not seeing news to really inspire people, so we're holding
in here at these new highs," said Michael O'Rourke, chief market
strategist at JonesTrading in Greenwich, Connecticut.
Homebuilders' shares gained and the common stock of mortgage
finance giants Fannie Mae and Freddie Mac
jumped as Federal Housing Finance Agency Director Mel Watt laid
out new policies that could make it easier for many Americans to
obtain mortgages. Fannie Mae jumped 9.4 percent to $4.64 while
Freddie Mac advanced 8.6 percent to $4.56.
Shares of Cisco Systems Inc, due to report results
on Wednesday, were the biggest drag on the Nasdaq. The stock was
down 1.3 percent at $22.90.
The Dow Jones industrial average rose 25.25 points or
0.15 percent, to 16,720.72. The S&P 500 gained 1.68
points or 0.09 percent, to 1,898.33.
The Nasdaq Composite dropped 4.79 points or 0.12
percent, to 4,139.069.
Earlier, the Dow rose to 16,735.51, an intraday record, and
the S&P 500 advanced to 1,902.17, also a lifetime intraday high.
The Dow Jones Transportation Average was up 0.5
percent and hit another intraday record, which some analysts say
points to upbeat prospects for the U.S. economy.
The dip in the Russell 2000 follows its biggest daily
percentage gain since early March. At its session low on Friday,
the index was down exactly 10 percent from the intraday record
high set in early March.
O'Rourke said he expects more consolidation in the Russell
2000, given how long it had outperformed the S&P 500.
More developments on the deal front helped the outlook for
stocks. Keurig Green Mountain Inc was the S&P 500's
biggest percentage gainer, up 9.8 percent at $121.57. The stock
climbed after Coca-Cola Co said it will raise its stake
in the company, the maker of the popular Keurig one-cup coffee
brewer, to 16 percent from 10 percent.
In other deal news, DirecTV shares slipped 0.2
percent to $86.95 a day after sources told Reuters that AT&T Inc
was in active talks to buy the company in a deal that
could be worth close to $50 billion. AT&T's stock dropped 1.4
percent to $36.07.
Among homebuilders, the stock of D.R. Horton Inc rose
2.8 percent to $23.21. The PHLX housing sector index
gained 0.6 percent.
Data did little to change the view that the U.S. economy is
poised for faster growth this quarter. Retail sales rose 0.1
percent in April, less than expected, though the March reading
was revised upward.
(Editing by Bernadette Baum, Nick Zieminski and Jan Paschal)