Dow edges higher as strong Apple results offsets virus fears

NEW YORK  – Strong profits from Apple and others helped the Dow edge higher on Wednesday (Jan 29) as more large companies moved to contain a virus centred in China, but the broader market was more mixed.

The biggest company by market capitalisation, iPhone maker Apple jumped 2.1 per cent after the Dow component reported record quarterly profits of US$22 billion (S$29 billion) on revenues of US$91.8 billion, also an all-time high.

But Apple chief executive officer Tim Cook struck a sombre tone over the spread of the deadly virus in China, a key market for and supplier to the company, while Starbucks, McDonald’s and American Airlines were among the large companies curtailing China activities.

The Dow Jones Industrial Average rose less than 0.1 per cent to end at 28,734.45.

The broad-based S&P 500 dipped 0.1 per cent to 3,273.40, while the tech-rich Nasdaq Composite Index advanced 0.1 per cent to 9.275.16.

The mixed session came after the Federal Reserve, as expected, kept interest rates unchanged, but central bank chairman Jerome Powell warned the virus remained a potential risk.

Among other companies reporting results, Boeing gained 1.7 per cent after announcing its first annual loss in more than two decades as a result of the protracted 737 Max grounding.

The company announced US$9.2 billion in additional costs related to the Max crisis, a huge number, but one that was lower than some analysts feared.

General Electric surged 10.3 per cent as it reported better-than-expected fourth-quarter profits that included signs of stabilisation in its slumping power business.

But Starbucks dropped 2.1 per cent as it announced that it closed half its China stores due to the coronavirus, and said it was too soon to project the potential financial hit from the situation.

Among other companies reporting results, McDonald’s gained 1.3 per cent and Advanced Micro Devices dropped 6.0 per cent.