S&P up for sixth day, Apple slip could halt rally

S&P was just 4.7% from its all-time closing high on IBM's and Google's earnings

The S&P 500 rose for a sixth day on Wednesday after stronger-than-expected profits from IBM and Google but the rally could be halted as Apple's after-hours miss sent its shares lower.

The S&P was just 4.7% from its all-time closing high as IBM's and Google's earnings, released after Tuesday's close, followed on the heels of stronger US economic data.

"People were kind of nervous about earnings coming into this quarter but numbers have shown so far strength in earnings," said King Lip, chief investment officer at Baker Avenue Asset Management in San Francisco.

But Apple, still the largest US publicly traded company, fell 8% in extended trading after sales of its flagship iPhone came in below analyst targets and quarterly revenue slightly missed Wall Street expectations.

"One thing that stands out is the company's ballooning balance sheet, where they now have $137 billion dollars in cash and investments," said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut. "You've got to wonder when they're going to put some more of that to work."

Declining issues beat advancers in both the NYSE and Nasdaq during regular market hours, in a sign the market's rally may be overstretched. The broad Russell 2000 index closed the day down 0.3% after earlier hitting and intraday historic high just below 900 points.

Shares in IBM Corp, the world's largest technology services company, climbed 4.4% during regular market hours to $204.72, providing just about all of the Dow's 67-point gain.

Also helping the tech sector was a 5.5% jump in Google Inc to $741.50. The Internet search company reported its core business outpaced expectations and revenue was higher than expected.

The S&P technology sector rose 1.2%.

The Dow Jones industrial average rose 67.12 points or 0.49%, to 13,779.33, the S&P 500 gained 2.25 points or 0.15%, to 1,494.81, and the Nasdaq Composite added 10.49 points or 0.33%, to 3,153.67.

The benchmark S&P 500 is a mere 0.35% away from hitting 1,500, a level not seen since December 12, 2007.

S&P 500 futures fell 4.1 points, or 0.3%, while Nasdaq 100 futures fell 20 points or 0.7%.

Netflix shares soared 32%, above $136, after the video subscription service said it added subscribers in the United States and abroad and posted a quarterly profit.

LED maker Cree Inc jumped 22% to $40.85 after it forecast a higher-than-expected third-quarter profit, and reported results above analysts' estimates.

Upscale leather goods maker Coach Inc plunged 16.4% to $50.75 after reporting sales that missed expectations.

Clearing a market hurdle, the US House of Representatives passed a Republican-led plan to extend the country's borrowing authority until mid May. This delays a confrontation in Congress similar to one in 2011, which generated a stalemate that triggered the first-ever US debt rating downgrade.

Thomson Reuters data through Wednesday showed that of the 99 S&P 500 companies that have reported earnings so far, 67.7% have topped expectations, above the 65% average beat over the past four quarters.

Overall, S&P 500 fourth-quarter earnings rose 2.8%, according to Thomson Reuters data. That estimate is above the 1.9% forecast at the start of earnings season.

Top US manufacturers sounded a confident note about their expectations for 2013 on Wednesday as fears of the year-end "fiscal cliff" faded into memory.

In the regular session, about 6.1 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the 2012 daily average of about 6.45 billion.

On the NYSE, roughly 15 issues fell for every 14 that rose and on Nasdaq seven declined for every five gainers.