By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks ended Tuesday generally
higher with the Nasdaq Composite recording its eighth consecutive
session of gains, the longest since July 2013.
The Dow Jones Industrial Average (DJI) defied the general trend,
ending lower after component Coca-Cola Co. (KO) reported
disappointing earnings. Also weighing: the Empire State
manufacturing activity index dropped by more than expected while a
gauge of confidence among home builders dove in February.
The S&P 500 index (SPX) closed 2.13 points, or 0.1%, higher
at 1,840.76, extending gains from the previous two sessions. Seven
of 10 main sectors rose, with health-care stocks in the lead.
The Nasdaq Composite (RIXF) rose 28.76 points, or 0.7%, to
4,272.78. The tech-heavy index outperformed other indexes so far
this year, gaining 2.6% since the end of last year. Read the recap
of our stock market live blog.
Markets were closed on Monday for the Presidents Day holiday.
Last week, stocks registered their best weekly gains of the year,
and the Nasdaq Composite closed at a July 2000 high.
"It is not surprising for markets to have a slow day such as
today, especially after big rally at the end of the year followed
by a pullback in January," said Colin Cieszynski, senior market
analyst at CMC Markets, based in Toronto.
"Investors seem to treat weak economic manufacturing and housing
reports with understanding that weather played a big role in the
slowdown," he added.
Empire State, home builders
Manufacturing activity in the New York region gave up most of
the strong gains made during the prior month although it remained
in positive territory, according to data released Tuesday. The
report fits a picture of a manufacturing sector struggling with
severe winter weather. The ISM index for the U.S. showed
manufacturers suffered from the January chill last month.
A gauge of confidence among home builders plunged in February,
dropping to the lowest level in nine months, led by weaker views on
present sales of single-family homes, according to data released
Tuesday.
The housing-market index dropped to 46 this month from 56,
signaling that builders, generally, are pessimistic about sales
trends, according to the National Association of Home
Builders/Wells Fargo, which cited "unusually severe weather
conditions," among other factors.
Movers: Forest Labs, Tesla, BlackBerry
Big movers on Wall Street Tuesday include Forest Laboratories
Inc. (FRX), with shares surging 28% on news that Actavis PLC (ACT)
will buy its New York-based rival in a cash-and-stock deal worth
$25 billion. Actavis rose 5%.
Shares of Coca-Cola were down 3.8% after the beverage company's
fourth-quarter profit and revenue came in below analyst
forecasts.
Read Jim Jelter: Why Coke needs Green Mountain
Shares of Tesla Motors Inc.(TSLA) were up 2.8% to $203.70
Tuesday, a record close, after a report that Apple Inc.'s (AAPL)
top deal maker met with the car company's CEO, Elon Musk, last year
as part of its quest to snap up companies to fuel growth. Also,
R.W. Baird analysts raised their price target on Tesla to $215.
BlackBerry Ltd. (RIMM) was up 5.4% following news Friday that
billionaire fund manager Dan Loeb took a stake in the company as
part of his investment in struggling device makers.
FBR & Co. also upgraded BlackBerry's stock to market perform
from underperform, with analyst Scott Thompson writing in a note:
"We expect the company's liquid assets and early positive momentum
could limit downside in shares in the near term."
Prana Biotechnology Ltd. (PRAN) soared 39% to $10.10 after the
pharmaceutical company said it met the endpoint for one phase of a
clinical study testing its treatment for Huntington's disease.
After hours: Herbalife
Herbalife (HLF) shares, which closed 3.8% higher, rallied as
much 4% in aftermarket action after the company reported
estimate-beating fourth-quarter results. Herbalife said earlier
this month that it plans to offer $1 billion in convertible notes
and use the proceeds to buy back shares.
Overseas: Bank of Japan boost
In Asia, Japan's Nikkei 225 index rallied 3.1% after the Bank of
Japan said it would double incentives designed to increase bank
lending. Other Asian markets closed mixed.
European stock markets ended marginally higher and stayed in
negative territory after a disappointing reading on German economic
sentiment. Gold prices edged higher while the dollar and oil prices
rose.
More must-reads from MarketWatch:
Soros doubles a bearish bet on the S&P 500, to the tune of
$1.3 billion
Investor prisoner, volume control, when Apple met Tesla and
Forest Labs
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