(Bloomberg) The Standard & Poor’s 500 Index erased gains, sending the benchmark index lower for the fourth time in five days, as a rally in Apple (AAPL) Inc. faded and banks retreated.
Apple, which is forecast to sell 10 million iPhone 5s this weekend in the device’s debut, rose 0.2 percent after climbing as much as 0.9 percent.
The S&P 500 fell less than 0.1 percent to 1,460.12 at 4 p.m. in New York. The Dow Jones Industrial Average lost 17.77 points, or 0.1 percent, to 13,579.16. Friday’s trading came amid the expiration of equity futures and options contracts, a process known as quadruple witching, as well as S&P’s quarterly index rebalancing.
“I think the market this week has clearly been digesting the gains of the previous several weeks,” Hank Smith, chief investment officer at Haverford Trust Co. in Radnor, Pennsylvania, said in a telephone interview. His firm oversees $6.5 billion in assets.
Bloomberg reports the benchmark index for U.S. equities fell 0.4 percent this week as reports signaled global economies are slowing. The benchmark index has rallied 16 percent this year and last week closed at the highest level since 2007 after the Federal Reserve and the European Central Bank announced monetary stimulus measures. The index trades for about 14.9 times its companies’ reported earnings, compared with an average price-to-earnings multiple of about 16.3 since 1954.
The U.S. is the most attractive stock market because of the strength of corporate balance sheets, low interest rates and valuations, said billionaire investor Michael Price, who made his reputation as a value investor in the 1980s by buying shares of beaten-down lenders and running some of the best-performing U.S. mutual funds.
“As the economy improves and as uncertainty from our election and China and all the European issues go away, American consumers have enormous pent-up demand,” Price said in a “Bloomberg Surveillance” interview with Tom Keene and Sara Eisen. “It’s very early for European stocks.”
Price, president of MFP Investors LLC, said he’s bullish on J.C. Penney Co. because the U.S. retailer is “doing all the right things” and will benefit from rising demand among U.S. shoppers.
J.C. Penney shares, which tumbled 11 percent yesterday, will rally amid a rebound in consumer spending when concerns about the global economy subside, said Price. He said the retailer is trading for about half of its “intrinsic value.” He also likes Citigroup Inc. (C) shares because they’re the cheapest among large U.S. banks, he said.