* Valeant raises cash component of Allergan bid; shares fall
* S&P 500 tries for fifth straight day of gains
* DJ Transportation Average hits intraday record high -
* Dow off 0.1 pct; S&P 500 up 0.1 pct; Nasdaq off 0.1 pct
(Updates to afternoon trading, changes byline)
By Chuck Mikolajczak
NEW YORK, May 28 U.S. stocks barely budged on
Wednesday as an absence of economic catalysts put technicals in
focus and kept the S&P 500 near its newest intraday record.
The S&P 500 has gained for four straight sessions as
investors' appetite for equities has been buoyed by supportive
U.S. economic data recently and expectations of monetary easing
by the European Central Bank, while the 10-year U.S. Treasury
note's yield slipped below 2.44 percent, its lowest
level since July.
"We made a pretty decisive move above 1,900" on the S&P 500,
said Jim Paulsen, chief investment officer of Wells Capital
Management in Minneapolis.
"Economic momentum is clearly to the upside at the moment,
the surprise index is up, and that's pretty powerful for
stocks," he said, referring to Citi's Economic Surprise Index,
which measures how well data performs relative to forecasts.
"We've had a constant stream of better-than-expected data, and
the bond market has remained supportive."
The drop in fixed-income yields could lift the prices of
dividend-paying stocks. The S&P utilities index is up
The Dow Jones Transportation Average extended its run
into record territory, hitting a lifetime intraday high of
8,096.09 after closing on Tuesday above 8,000 for the first
time. When the transports sector does well, the trend signals an
improved outlook for the U.S. economy and the stock market.
The Dow Jones industrial average fell 18.19 points or
0.11 percent, to 16,657.31. The S&P 500 gained 1.06
points or 0.06 percent, to 1,912.97. The Nasdaq Composite
dropped 3.63 points or 0.09 percent, to 4,233.44.
If the S&P 500 advances for a fifth straight day, this would
be its second-longest run this year. The index hit 1,914.46, a
fresh intraday record high, and remains in the 1,910 area seen
as technical resistance. Support kicks in at 1,900 and then at
the 14-day moving average, now near 1,889.
U.S.-traded shares of Canadian drugmaker Valeant
Pharmaceuticals fell 1.6 percent to $127.78 after the
company raised the cash component of its offer for Botox maker
Allergan, valuing the U.S. company at $49.44 billion.
Allergan fell 4.5 percent to $157.66.
Shares of Toll Brothers, the largest U.S. luxury
homebuilder, rose 2 percent to $36.36 after the company reported
that its quarterly profit more than doubled as it sold more
homes at higher prices.
Among retailers, Michael Kors Holdings Ltd climbed
1 percent to $96.67 following the company's quarterly earnings
as sales of its handbags and watches surged in North America.
But the company - founded by fashion designer Michael Kors -
cautioned that it expected the cost of opening new stores in
Europe to depress gross margins in the next few quarters.
In contrast, footwear retailer DSW lost more than a
fourth of its market value after the company missed estimates on
its results and outlooks. The stock sank 27.6 percent to $23.54.
(Additonal reporting by Rodrigo Campos; Editing by Bernadette
Baum and Jan Paschal)