The Dow Jones Industrial Average (DJINDICES: ^DJI ) was the only one of the three major indexes to post a gain today, surviving President Obama's warning on the debt ceiling and reports that Apple (NASDAQ: AAPL ) sharply cut back orders for parts for the iPhone 5. Bouncing back from an early session dip, the blue chips finished the day up 19 points, or 0.1%.
In his last conference before the inauguration, President Obama called on congressional Republicans not to play games with the debt limit, which will be hit in as soon as a month if no action is taken, potentially leading to a default. The GOP has demanded that spending cuts be attached to any increase in the debt ceiling. In August 2011, a similar stalemate sent the Dow plummeting nearly 2000 points over a span of just two weeks and led Standard & Poor's to lower the U.S. credit rating. For those who hoped the arm-twisting over the fiscal cliff was over, it looks like a sequel may be fast on the way.
Shares of Apple finished the day down 3.6% on reports that the tech giant cut its order for iPhone parts by half for the first quarter of the year. Apple would not confirm or deny the news, which seems to justify the decline that has sent shares down nearly 30% since their September high. Shares of iPhone supplier Cirrus Logic fell sharply as well, down nearly 10%. Apple will elaborate on the orders when it reports earnings next Wednesday.
Taking a look at the Dow, Hewlett-Packard (NYSE: HPQ ) once again led all comers, rising 4.9%. The struggling PC-maker appeared to benefit from a report showing it regained the market share lead in computers from Lenovo, despite a decline in the overall market, and also got a bump from research indicating a strong expansion in the enterprise market. HP shot up suddenly in afternoon trading when news broke that rival Dell (UNKNOWN: DELL.DL ) may be taken private. According to reports originally published by Bloomberg, two private-equity companies are in talks with CEO and founder Michael Dell to initiate a possible management-led buyout of the PC-maker, worth more than $20 billion, with Mr. Dell heading the new organization. Dell shares jumped 13% during the session, and another 3.6% after hours.
Finally, Verizon (NYSE: VZ ) led the Dow losers, falling 1.6% on a downgrade from UBS. The Swiss bank cut Big Red from "buy" to "neutral" on lowered Q4 profit expectations in its wireline and wireless segments.
The market should heat up over the rest of the week, as retail sales are on tap tomorrow, and a slew of Dow components report earnings later in the week. Don't forget to check back in.
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