A frail-looking Steve Jobs stepped back into the spotlight for the first time in nearly a year on Wednesday, unveiling new and cheaper iPods for Apple Inc and drawing a standing ovation.

But Apple's shares closed 1 percent lower after hitting a year's high in the session. Analysts explained the dip both by pointing to how gaunt the 54-year-old chief executive looked and by saying investors took profits after a steady run-up in the few days before the event.

Dressed in his trademark black turtleneck and jeans, Jobs took the stage and thanked everyone in the Apple community for their heartfelt support. It was his first public appearance since returning to work in June after six months of medical leave, during which the charismatic corporate showman underwent a liver transplant.

I now have the liver of a mid-20s person who died in a car crash and was generous enough to donate their organs. I wouldn't be here without such generosity, an emotional Jobs told the audience, urging them to all become organ donors.

Apple shares initially rose about 1 percent to a year's high before retreating to close $1.79 lower, or 1 percent, at $171.14 on Nasdaq.

I'm sure (Jobs) looking so frail -- the guy's had the most extreme surgery you can have -- didn't help matters, but I think people have come to grips that the torch is going to be passed. It's just a matter of when, said Dave Rovelli, managing director of U.S. equity trading at Canaccord Adams.

The stock's had such an incredible move, I wouldn't read too much into it. It's probably just some profit taking.

Apple's stock has doubled this year, giving the company a market value of $155 billion -- triple that of smartphone arch-foe Research in Motion, which makes the BlackBerry -- but still lagging the $221 billion of Microsoft.

Jobs, a pancreatic cancer survivor, started off by announcing a new version of Apple's popular online media store, iTunes, and updated software for the iPhone.

He then unveiled new iPod features and colors, including a video camera added to the iPod nano, and announced price cuts for other models ahead of the crucial holiday season.

Analysts had been expecting an appearance by the company co-founder to give Apple's stock a boost since late last week. The shares rose in the afternoon to $174.47, their highest since August 28, 2008. But they quickly retreated.

The announcements that were made were not particularly surprising -- a lot of it was expected. But on the flip side, Steve Jobs making an appearance was definitely a pleasant surprise, said Kaufman Bros analyst Shaw Wu, who also saw profit-taking depressing the stock in the afternoon.

We still think the stock trends higher into year end. We think this is one of the better, if not the best, play on the smartphone trend as well as the trend to digital media.

RUMORS OF MY HEALTH

There was no sign of the much-talked about tablet device, another groundbreaking gadget that many analysts say is more likely to emerge later this year or early next. Never confirmed by Apple, investors hope it will become Apple's next growth catalyst.

Jobs's return was well-timed. The holiday season is a critical period for Apple, as it is for many consumer electronics companies, as shoppers fill stores and spend their precious discretionary income on the latest gadgets.

Apple's iPod commands more than 70 percent of the U.S. portable media-player market, and its popularity -- together with the iPhone and Mac computer -- have helped Apple grow into a consumer electronics giant.

December-quarter sales made up around 30 percent of Apple's revenue last fiscal year.

On Wednesday, Jobs announced price cuts on most of the iPod range, including a $30-cheaper, $199 touch. He also announced the addition of a video camera, FM radio and pedometer to its mid-range nano, new iTunes software and updates for the iPhone software.

With few revolutionary products, much of the attention was focused on Wednesday on Jobs himself.

Jobs stepped away from day-to-day operations in January after months of rumors about his health and noticeable weight loss. He returned early this summer, but had not been seen at a public event until Wednesday.

As expectations of a high-profile product launch faded in the run-up to the event, much of the speculation centered on whether Jobs would appear.

Some analysts had speculated that Jobs would not turn up so as not to steal the spotlight from Apple's new products. Others had seen him taking on more of a behind-the-scenes role, despite his demonstrated talent for pitching products, as other executives step to the forefront.

But Jobs is also famous for his attention to detail and the huge amount of control he exerts over Apple and its products.

Our larger point about Steve is that no single individual designs products as complex as the iPhone and Macs and Leopard. They are far too complex to assume that one individual does that, and markets it and brands it. Apple has a phenomenally deep bench, said Daniel Ernst at Hudson Square Research. (For a photo, please click on http://blogs.reuters.com/photo/2009/09/09/live-from-the-apple-media-extravaganza/

A greater question for Apple at the moment is ... what is the health of the consumer, who is really their core customer, in the fourth quarter? We have unemployment nearing 10 percent and Apple's still growing better than the rest of tech, but it's still an issue, he said.

(Reporting by Gabriel Madway and Sinead Carew; Additional reporting by Leah Schnurr and Ritsuko Ando in New York and Clare Baldwin in San Francisco; writing by Edwin Chan; Editing by Andre Grenon, Maureen Bavdek, Gary Hill)

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