* S&P 500 briefly rises above 1,900 for the first time
* Homebuilders rally; Keurig up on Coke's plan to raise
* Cisco falls 1 percent, weighs on the Nasdaq
* Dow up 0.1 pct; S&P 500 up 0.04 pct; Nasdaq off 0.3 pct
(Updates to close)
By Caroline Valetkevitch
NEW YORK, May 13 The Dow and the S&P 500 eked
out record closing highs again on Tuesday, while the Nasdaq
resumed its recent slide, dragged down by shares of Cisco
The S&P 500 briefly rose above 1,900 for the first time
early in the session, but quickly gave back some of its gains.
In contrast, the Russell 2000 index of small-cap stocks
fell 1.1 percent.
"We didn't see much of a followthrough from yesterday's
runup. That started a discussion as to whether the economy was
going to bounce back as strongly as some folks had been
expecting," said Bucky Hellwig, senior vice president of BB&T
Wealth Management in Birmingham, Alabama.
"We've eked out a gain in the broad averages but continue to
see weakness in the Nasdaq and small caps so that divergence has
got some investors concerned. What you see is a smaller group of
stocks participating in the rally."
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 7.8 percent to $4.57 while
Freddie Mac advanced 6.9 percent to $4.49.
Cisco Systems Inc, set to report results on
Wednesday, was the biggest drag on the Nasdaq. The stock slid
1.4 percent to end at $22.86.
The Dow Jones industrial average rose 19.97 points or
0.12 percent, to 16,715.44, its third straight record closing
high. The Dow also set an intraday record at 16,735.51.
The S&P 500 gained just 0.8 of a point or 0.04
percent, to 1,897.45, its second straight record closing high.
The S&P 500 also advanced during the session to 1,902.17, a
lifetime intraday high.
The Nasdaq Composite dropped 13.69 points or 0.33
percent, to 4,130.165.
The drop in the Russell 2000 came a day after the index
scored 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.
The Dow Jones Transportation Average rose 0.5 percent
after hitting another intraday record high, which some analysts
say points to upbeat prospects for the U.S. economy.
More developments on the deal front enhanced the outlook for
stocks. Keurig Green Mountain Inc was the S&P 500's
biggest percentage gainer, up 7.6 percent at $119.07. 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. Coca-Cola
rose 0.7 percent to $41.11.
In other deal news, DirecTV shares slipped 1.2
percent to $86.08 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
percent to $36.20 and was the biggest drag on the S&P
Among homebuilders, the stock of D.R. Horton Inc rose
2.2 percent to $23.07. The PHLX housing sector index
gained 0.2 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.
About 5.5 billion shares changed hands on U.S. exchanges,
below the 6.1 billion average for the month to date, according
to data from BATS Global Markets.
(Editing by Bernadette Baum, Nick Zieminski and Jan Paschal)