Sept. 26 (Bloomberg) -- By Rita Nazareth and Michael P. Regan
Sept. 26 (Bloomberg) -- U.S. stocks trimmed gains as Apple Inc. led technology shares lower after an analyst said it is cutting orders for iPad parts, tempering an early rally triggered by European leaders’ plans for resolving the debt crisis.
Apple slumped 2.8 percent after JPMorgan Chase & Co. said several supply-chain vendors indicated the company lowered fourth-quarter iPad orders by 25 percent.
The Standard & Poor’s 500 Index was little changed at 1,136.83 at 10:02 a.m. in New York after climbing as much as 1.1 percent.
The Dow Jones Industrial Average last week sank 6.4 percent, its biggest loss in almost three years, as the Federal Reserve said risks to the U.S. economy had increased and Europe’s debt crisis went unresolved.
Last week’s rout erased $1 trillion from U.S. equities amid concern Greek insolvency is inevitable and Europe can’t contain the damage. The S&P 500 slumped 17 percent between April 29 and Sept. 23. The index’s gain since March 2009, when the last bear market ended, has been cut to 68 percent. The benchmark gauge for American common equity is trading at 12.4 times earnings in the past 12 months, 4.4 percent below its average valuation at the lowest point during the last nine bear markets, according to data compiled by Bloomberg.
Stocks are having the worst quarter on record relative to U.S. Treasuries and gold, which may force investors to buy equities to rebalance their allocations, JPMorgan Chase & Co.’s Marko Kolanovic said. U.S. and emerging-market equities have returned 43 percentage points less, the most during a quarter since at least 2002, according to data compiled by Kolanovic, whose analysis is based on a model portfolio composed of stocks, bonds and gold.
“This underperformance may trigger significant quarterly rebalance flows into equities and out of Treasuries at the end of next week,” Kolanovic, the New York-based global head of equity derivatives strategy at JPMorgan, wrote in a note to clients last week.
To contact the editor responsible for this story: Michael P. Regan at email@example.com