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Stocks closed mixed as investors shrugged off concerns about overheating in China and focused on the latest batch of earnings from the likes of Merrill Lynch & Co., Bank of America Corp., Merck & Co. and eBay Inc. The Dow industrials ended at an all-time high, closing at a record level for the second straight session.

Today, the Dow Jones industrial average closed up 4.79 or 0.04% to 12,808.63, the broader S&P 500 closed down 1.77 or 0.12% to 1,470.73, and the Nasdaq closed down 5.15 or 0.21% to 2505.35.

Market breadth was negative. On the New York Stock Exchange, losers beat winners by 20 to 11 on volume of 1.6 billion shares. On the Nasdaq, decliners topped advancers 9 to 5 as 2.1 billion shares changed hands.

Investors weighed the latest earnings reports, falling oil prices and the implications of a big sell-off in Asian and European markets. The upbeat start to the earnings reporting period, helped the market consolidate. The overall earnings growth will probably beat the estimates by around 3% meaning first-quarter S&P 500 growth will probably end up at around 7 to 8%.

In economic news, the March index of leading economic indicators rose 0.1% as expected, after falling a revised 0.6% in the previous month. The April Philadelphia Fed index, was unchanged at 0.2 in the month, missing forecasts for a rise to 3.

Stock of eBay closed down $1.39 or 2.6% to $33.06, after reporting higher quarterly results that topped forecasts. It posted a 52% jump in net profit on a 27% revenue rise, led by growth in its core auctions business and the rising prominence of international sales. It predicted the 2007 year, revenue would range between $7.2 billion and $7.45 billion – beating its previous revenue forecast of $7.05 billion to $7.3 billion.

Shares of Merrill Lynch dropped 0.6%, despite earnings topped expectations. The company earned $2.16 billion, vs. $475 million a year ago.

Stock of Nokia closed up $0.82 to $24.69, after it reported improved sales in emerging markets and improved profit margins. Its EPS rose slightly to 0.26 euros, from 0.25 a year ago. Sales rose 4% to 9.86 billion euros, but came in below the forecast of 10.16 billion.

Shares of Intel closed up $0.46 to $21.81, as the company continued to gain on positive analyst commentary following its quarterly earnings report. Its net income rose 19% to $1.6 billion from a year earlier. But EPS matched expectations at 22 cents a share. However, revenue fell to $8.85 billion from $8.94 billion a year earlier.

U.S. light crude oil for May delivery fell $1.63 to $61.50 a barrel on the New York Mercantile Exchange.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter
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