U.S. stocks rise as Obama weighs Syria alternatives, Apple drops

Stimulus Speculation

Speculation about the stimulus has whipsawed stocks since May, when Chairman Ben S. Bernanke first indicated cuts could start this year. The S&P 500 tumbled 5.8% from a record high on May 21 through June 24. It rebounded 8.7% to close at its latest all-time high of 1,709.67 on Aug. 2. The gauge then slumped as much as 4.6% before the current rally brought it back to within 1.4% of the record and above the May 21 peak.

Stanley Druckenmiller, who boasts one of the hedge-fund industry’s best long-term track records of the past three decades, said ending the bond buying over the next year will roil markets.

“I really don’t care whether we go to $70 billion or $65 billion in September,” Druckenmiller said today in an interview with Bloomberg Television. “But if you tell me quantitative easing is going to be removed over nine or 12 months, that is a big deal.”

Volatility Slide

The Chicago Board Options Exchange Volatility Index, or VIX, dropped 3.7% to 13.99. The equity volatility gauge is down 18% in September after rallying 26% in August, the biggest monthly gain since May 2012.

Seven of 10 industries in the S&P 500 advanced, with commodities stocks and consumer-staples producers rising at least 0.5%. Newfield Exploration Co. jumped 5.9% to $25.67 as crude supplies in Cushing, Oklahoma, tumbled to the lowest since February 2012.

Apple dragged technology shares lower, dropping 5% to $470.02 for its biggest slide since April 17. The company introduced two models of its iPhone yesterday and was cut to neutral from buy at Bank of America Corp., which said that the lower-cost smartphone cost too much to increase sales in emerging markets.

Credit Suisse Group AG lowered the Cupertino, California- based company to neutral from outperform, UBS AG cut its rating on the stock to neutral from buy and Piper Jaffray Cos. lowered its 12-month price target on Apple’s shares to $640 from $655.

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