Intel leads the pack of Dow gainers
U.S. stocks rose on Friday, 13 September 2013 with the Dow industrials posting their best week since January, as worries about Syria ebbed and as investors looked to next week's monetary-policy decision by the Federal Reserve. Friday's session was very quiet as participants displayed tepid demand for equities ahead of next week's highly-anticipated FOMC meeting where a tapering announcement may occur. Despite the temporary slide into negative territory, the key indices were able to reclaim and hold their early highs into the close.
The Dow Jones Industrial Average rose 75.42 points, or 0.5%, to 15,376.06 on Friday. The Nasdaq Composite climbed 6.22 points, or 0.2%, to 3,722.18, leaving it up 1.7% from the week-ago close. Tallying a 2% weekly gain, the S&P 500 Index was up 4.57 points, or 0.3%, at 1,687.99, with consumer staples pacing sector gains and technology its weakest performer.
Shares of Intel paced blue-chip gains, up 3.6% after Jefferies upgraded the chip maker to buy from hold.
Excluding a brief dip during the opening hour, the major averages were confined to narrow ranges. The early weakness took place after it was reported that the University of Michigan Consumer Sentiment Index dropped to its lowest reading since April (76.8) in the preliminary September reading.
Looking back at Friday's economic data, the retail sales and PPI reports conveyed a familiar message of modest growth and low inflation. August retail sales came in below expectations (0.2% v. 0.4% Briefing.com consensus), but the July reading was revised higher to reflect an increase of 0.4% (0.2% prior).
Separately, total PPI jumped 0.3% (consensus 0.2%) while core PPI, which excludes food and energy, was flat (consensus 0.1%).
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Also, total business inventories rose 0.4% in July after increasing an upwardly revised 0.1% (from 0.0%) in June. The consensus expected business inventories to increase 0.3%. Manufacturer (0.2%) and merchant wholesaler (0.1%) inventories were known prior to the release. The only new information was that retailer inventories increased 0.8% in July after increasing 0.1% in June.
Gold futures closed lower on Friday, 13 September 2013 suffering a loss of almost 6% for the week as investors mulled the likely nominees for U.S. Federal Reserve chairman and the outcome of the central bank's monetary policy meeting next week. Gold for December delivery fell $22, or 1.7%, to settle at $1,308.60 an ounce on the Comex division of the New York Mercantile Exchange. For the week, prices lost 5.6% from last Friday's close of $1,386.50. December silver, which tumbled 4.4% on Thursday furthered its decline by 43 cents, for a 1.9% drop to $21.72 an ounce. It fell 9.1% on the week.
Crude Oil futures settled lower on Friday, 13 September 2013 at Nymex contributing to an overall loss for the week, as disappointing U.S. retail sales and consumer sentiment data dulled the outlook for energy demand. The market continued to keep tabs on efforts to avert a U.S. military strike in Syria, but the focus has shifted to the Federal Reserve's upcoming decision on monetary policy next week.
Crude oil for October delivery shed 39 cents, or 0.4%, to settle at $108.21 a barrel on the New York Mercantile. For the week, prices ended 2.1% lower. Since the end of August, the Syria debate has caused oil prices to increase; and the most recent August employment gains were much weaker than expected. Equity prices, however, have been moving higher.
Tuesday and Wednesday of next week will bring the FOMC policy meeting where many expect the Fed to announce a reduction in the size of its asset purchases. The taper talk began after Fed Chairman Ben Bernanke mentioned, during his June 19 press conference, that barring a downturn in the economy, the Fed could scale back the size of its purchases later in the year. Following the press conference, participants began looking to the September meeting as a possible start date for tapering.
For every two stocks falling, more than three gained on the New York Stock Exchange, where 569 million shares traded. Composite volume topped 2.7 billion.
On Monday, the September Empire Manufacturing survey will be released at 8:30 ET while August industrial production and capacity utilization will be reported at 9:15 ET.
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