Nasdaq climbs on Apple, signs of growth

The Nasdaq Composite rose on Thursday as technology shares benefited from stronger-than-expected economic data and Apple Inc shot to a record on expectations of strong sales momentum for its iPhone. But rising bond yields were a damper on the broader market, leaving the Dow industrials and S&P 500 barely changed on the day.
A $20 billion buyout bid for Hilton Hotels Corp by Blackstone Group late on Tuesday sent shares of the hotel chain surging. Other lodging stocks also got a lift from the bid, including casino chain Wynn Resorts Ltd and Host Hotels & Resorts Inc.
The Institute of Supply Management's report on services for June pointed to a robust economy, while separate data showed better-than-expected job growth in June.
Technology companies "ordinarily are the best performers when the economy is expanding and interest rates are rising," said Hugh Johnson, chief investment officer of Johnson Illington Advisors in Albany. "Clearly the news today says the economy is expanding."
The Dow Jones industrial average was down 11.46 points, or 0.08 percent, at 13,565.84. The Standard & Poor's 500 Index was up 0.53 points, or 0.03 percent, at 1,525.40. The Nasdaq Composite Index was up 11.70 points, or 0.44 percent, at 2,656.65.
Shares of Apple rose 4.4 percent to $132.75, after hitting a record high of $132.97 earlier, making it the top-weighted gainer on the Nasdaq and S&P. Research in Motion Ltd, the maker of the Blackberry device, was the second-heaviest gainer on the Nasdaq, rising 4 percent to $216.19. Shares of RIM also touched a lifetime high during the session.
On the downside, a run-up in bond yields stirred concern that higher interest rates would drive up borrowing costs for companies and consumers. Higher yields also hurt shares of utility companies, whose generous dividends serve as a substitute for steady income investments when Treasuries are less attractive.
Bond yields rose after the stronger-than-expected job market and service sector data dimmed demand for Treasuries and sent prices on fixed-income assets lower. Bond prices and yields move inversely.
The Institute for Supply Management's June services index came in strong, indicating growth in the huge US service sector. As employment grows, the Federal Reserve appears less likely to cut official interest rates in the near future. The benchmark US 10-year Treasury note was down 26/32 in price with the yield up to 5.15 percent.
The ADP employment survey precedes the widely anticipated non-farm payrolls report from the Labour Department on Friday. Rate-sensitive banking stocks fell. J.P. Morgan Chase shares lost 1.1 percent to $48.79, while Goldman Sachs slipped 1.4 percent to $221.32. Among utilities, Constellation Energy Group Inc shares fell 1.3 percent to $88.85, while PG&E Corp shares lost 1.2 percent to $45.19. Shares of General Motors Corp fell 3.5 percent to $36.67, dragging on the Dow, after it announced weak car and truck sales numbers on Tuesday.
On Thursday, Bear Stearns cut its recommendation on the stock of GM, the largest US automaker. GM shares fell 3.2 percent to $36.76 on the NYSE. Shares of Hilton Hotels surged 25.9 percent to $45.39 on news of the buyout bid, and shares of Blackstone rose 3.1 percent to $30.63.