This page is temporarily not available. Please check later as it should be available shortly. If you have any questions, please email customer support at email@example.com or call 800-767-3771 ext. 9339.
Encouraging earnings results coupled with consumer confidence and leading indicators data pushed the markets higher on Friday. After the Dow closed four points short of the highest level since December 2007 and the S&P 500 nearing a four-year high, The Wall Street Journal termed it as a ‘nail biting’ session. Trading occurred within a tight range and the Dow moved within the smallest range in two years. However, it was yet again a lackluster day of trading with volumes remaining low. Friday’s gains also ensured that the Dow and S&P 500 logged their sixth week of consecutive gains.
The Dow Jones Industrial Average (DJI) gained 0.2% and ended at 13,275.20. The Standard & Poor 500 (S&P 500) also added 0.2% and finished Friday’s trading session at 1,418.16. The tech-laden Nasdaq Composite Index jumped 0.5% and closed at 3,076.59. The fear-gauge CBOE Volatility Index (VIX) slumped 5.9% to drop to 13.45. Total volumes on the New York Stock Exchange clocked a mere 2.9 billion shares. Advancers outnumbered the decliners on the NYSE; as for 59% stocks that gained, 36% stocks closed lower.
Statistically, investors had a lot to cheer about on Friday. The VIX, which reflects the amount of fear and apprehension in the markets, was down to its lowest level in five years. More importantly, investors were eager to see benchmarks trade at multi-year highs. The Dow fell a mere four points short of its highest level, achieved in December 2007, ahead of the recession. The S&P 500 was just a point shy of a four-year high. Also, these gains ensured that the Dow and S&P 500 finished with a sixth consecutive weeks of gains. For the week, the Dow, S&P 500 and the Nasdaq gained 0.5%, 0.9%, and 1.8%, respectively.
Volumes have remained low all through this week. Thus, the fact that benchmarks are approaching multi-year highs comes at a time when investors are not really betting big bucks. Headlines have been few and far between on certain days recently. Coupled with the investors’ wait-and-watch attitude and the summer holidays this has meant markets have moved within a tight range. Strategists have also opined that investors are awaiting concrete action from the central banks of the U.S., Europe and even China.
Coming to Friday’s developments, retailers lifted sentiment after posting promising earnings results. Retail heavyweight Gap Inc. (NYSE:GPS) jumped 4.8% after reporting that second quarter income had soared 29%. The company also lifted the mood with its yearly guidance. The J. M. Smucker Company’s (NYSE:SJM) fiscal first quarter 2013 results surpassed estimates and it also said fiscal 2013 earnings are expected to be at the higher end of its guidance range. This announcement provided much encouragement and shares surged 5.1%. Separately, ANN INC’s (NYSE:ANN) quarterly earnings were up 24% and the company also upped its guidance. Thus, shares were set for a strong upward movement and they ended 20.4% higher.
Economic readings also chipped in to sustain the benchmarks’ stay in the green. The University of Michigan-Thomson Reuters consumer-sentiment index was up to a preliminary reading of 73.6 in August, jumping to its highest level in three months. This was up from July’s reading of 72.3. Thus, the jump in the index was a key positive for the economy. The reading of 73.6 also topped consensus estimates of 72.3.
Separately, the Index of Leading Economic Indicators was up by 0.4% to 95.8 in July. This comes after the 0.4% decline in June. The index also increased more than consensus estimates of 0.2%. The fall in initial claims has been a major factor responsible for the better-than-expected report.
On Friday, industry heavyweight and technological giant Apple Inc. (NASDAQ:AAPL) jumped 1.9% to an all-time high of $648.11. Apple is Nasdaq’s biggest component and thus it helped Nasdaq outperform fellow benchmarks. Moreover, Apple’s new high was also a positive for the broader markets and other technology shares including Google Inc. (NASDAQ:GOOG), Oracle Corporation (NASDAQ:ORCL), Cisco Systems, Inc. (NASDAQ:CSCO) and Red Hat, Inc. (NYSE:RHT) jumped 0.6%, 0.5%, 0.2% and 2.0%, respectively.