NEW YORK – The Dow Jones industrial average closed above the 11,000-point mark Tuesday, clinging to a milestone it reached Monday for the first time in 4 1/2 years, despite disappointing results from Alcoa Inc. (AA) and a profit warning from Phelps Dodge Corp. (PD).
The technology-laced Nasdaq Composite index extended its gains for a sixth straight day following an upbeat holiday sales report from Apple Computer Inc. (AAPL), which helped stocks pick up steam in the afternoon.
The Dow Jones industrial average closed down 0.32 points at 11,011.58. The Standard & Poor's 500 Index ended down 0.46 points, or 0.04 percent, at 1,289.69. The Nasdaq rose 1.63 points, or 0.07 percent, at 2,320.32.
"It's all about Alcoa ... but it's a boogeyman. I don't think Alcoa is going to set the tone for the quarter," Jim Awad, chairman of Awad Asset Management, said. "As we roll through earnings reports, on balance they're going to present a strong picture, as will forward-looking guidance."
Apple shares hit a lifetime high of $81.89 after the maker of the popular iPod digital music players and the Macintosh computer announced that revenue during the holiday season came in near the top of Wall Street's forecasts.
Alcoa, the world's biggest aluminum producer, reported a decline in quarterly profit as a result of lower production due to hurricanes, strikes and restructuring costs. .
Alcoa shares fell 3.1 percent, or 95 cents, to end at $29.60 on the New York Stock Exchange, making it the biggest drag on the Dow.
Copper miner Phelps Dodge Corp.'s stock slid 5.2 percent, or $7.97, to end at $146.58 after the company cut its earnings outlook for the fourth quarter by more than 75 percent.
The market is a critical juncture, said Tim Biggam, chief options strategist at Man Securities, a division of Man Financial.
"We need to see decent growth numbers for earnings reports to take the market appreciably higher," he said.
Apple also introduced a new iMac computer powered by an Intel Corp. chip at the company's annual Macworld conference in San Francisco. Apple shares rose 6.3 percent, or $4.81, to end at $80.86 on the Nasdaq.
In deal news, Home Depot Inc. (HD), another Dow component, said it would buy Hughes Supply Inc. , an Orlando, Florida, distributor of materials to construction and industrial markets, for $3.2 billion.
Hughes Supply shares rose 18.3 percent, or $7.06, to $45.61 on the NYSE. Home Depot's stock added 2.4 percent, or 98 cents, to $41.80, giving the Dow its biggest boost.
While big capitalization stocks were losing ground, small caps extended their red-hot streak, with the Russell 2000 and Standard & Poor's SmallCap 600 notching lifetime highs for the third straight session.
The Russell rose 0.7 percent at 710.99 after touching a record 711; the S&P SmallCap 600 was up 0.8 percent at 369.24, just below its all-time high.
At the North American International Auto Show in Detroit, General Motors Corp. (GM) announced price cuts across most of its vehicle lineup, but a close aide to Kirk Kerkorian, who is GM's biggest individual investor, urged the company to step up efforts to halt financial losses. GM shares declined 1.6 percent, or 35 cents, to $22.06 on the NYSE.
Volume was heavy on the NYSE with 1.73 billion shares trading hands, above last year's daily average. On Nasdaq, about 2 billion shares were traded.
Advancers beat decliners on the NYSE by about 6 to 5 while gainers outnumbered losers by 3 to 2 on the Nasdaq
Overseas, Japan's Nikkei stock average fell 1.85 percent. Britain's FTSE 100 fell 0.75 percent, Germany's DAX index lost 0.77 percent, and France's CAC-40 dropped 0.27 percent.
Reuters and the Associated Press contributed to this report.