U.S. stocks ended mostly higher

Latest fiscal drama on Capitol Hill to corporate earnings impact stocks

U.S. stocks ended mostly higher on Thursday, 17 October 2013 lifting the S&P 500 to a record finish, as Wall Street turned from the latest fiscal drama on Capitol Hill to corporate earnings that included better-than-expected results from Verizon Communications. Quarterly reports also included disappointing third-quarter revenue from a handful of high-profile companies, including Dow components International Business Machines and Goldman Sachs Group.

The Dow Jones Industrial Average lost 2.18 points to end at 15,371.65. It had fallen almost 145 points during the session. The Nasdaq Composite rose 23.71 points, or 0.6%, at 3,863.15. The S&P 500 index ended up 11.61 points, or 0.7%, at 1,733.15.

Telecommunications performed the best and technology the worst of its 10 major sectors.

Goldman Sachs and IBM ended with respective losses of 2.4% and 6.4% after both reported bottom-line beats on light revenue. Goldman Sachs missed top-line estimates by roughly $500 million while IBM reported revenue $1 billion below analyst expectations.

Shares of IBM weighed on the technology sector while financials were able to shake off Goldman's weakness with help from American Express. The Dow component jumped 5.1% following its earnings beat.

Among other notable Dow earnings, United Health Group fell 5.1% after reporting in-line results and Verizon gained 3.5% on above-consensus earnings.

The U.S. government was open for business on Thursday, after 16 days of partial closure. The U.S. Congress and President Obama came to a last-minute budget/debt ceiling deal on Wednesday and then passed and signed the legislation late Wednesday night.

The U.S. dollar index was sharply lower on Thursday and hit a fresh 8.5-month low, as currency traders realized the budget/debt deal reached Wednesday is just a band-aide placed on a gaping wound, and that the Federal Reserve won't be tapering its monthly bond purchases any time soon. There were reports overnight that a China-based credit rating agency downgraded the U.S. government's credit rating.

On the economic front, computer problems in California kept the initial claims level elevated for a second week in a row. The weekly initial claims level fell to 358,000 from a slightly downwardly revised 373,000 (from 374,000) for the week ending October 5. The consensus expected the initial claims level to fall to 330,000.

Separately, the manufacturing sector in the Philadelphia region remained strong in October. The Philadelphia Fed's Business Outlook Survey fell to 19.8 from 22.3 in September. The consensus expected the index to fall to 7.0. Unlike what happened in the New York Fed's Empire Manufacturing Sector, the manufacturing outlook in the Philly region was not affected by the government shutdown.

For every share falling, just over five advanced on the New York Stock Exchange, where 760 million shares traded. Composite volume cleared 3.4 billion.

Indian ADRs ended mixed on Thursday. In the IT space, Wipro shed 2.4% at $11.44 and Infosys was down 0.39% at $54.27. In the banking space, HDFC Bank gained 3.27% at $34.47 and ICICI Bank rose 3.03% at $34.29. In the other sectors, Dr Reddys Laboratories added 1.14% at $39.85 and Tata Motors was down 0.51% at $30.95.

There is no economic data scheduled to be reported tomorrow.

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