For the week, the Dow ended higher by 497.1 points (3.8%) at 13,435.21. Nasdaq ended higher by 141.35 points (4.8%) at 3,101.66. S&P 500 ended higher by 64.04 points (4.6%) at 1,466.47.
U.S. stocks ended with strong gains on Monday, 31 December 2012, the last trading day of FY 2012. Stocks rose as Wall Street embraced word of a deal to avert the fiscal cliff of steep spending cuts and tax hikes set to begin in 2013. Monday's session began on a slightly lower note after the weekend failed to advance the budget negotiations. Dow gained 166 points for the day.
U.S. stocks rallied and ended with triple digit strong on Wednesday, 02 January 2013. Stocks kicked off New Year on a party mode as Wall Street embraced the last-minute move to avoid going off the fiscal cliff of steep spending cuts and tax increases. Late Tuesday, the House of Representatives approved emergency bipartisan legislation that keeps sharply increased taxes at bay for all but a small slice of the nation's wealthiest. Equities also remained in party mode after the Commerce Department reported U.S. construction spending fell 0.3% in November.
Regarding the pact, President Barack Obama has said he will sign into law the legislation that sets up another fiscal-cliff type standoff in coming weeks, as the deal focused on raising revenue but bypassed spending reductions to address the U.S. deficit. For the day, the Dow ended higher by 308.41 points (2.35%) at 13,412.55. Nasdaq ended higher by 92.75 points (3.1%) at 3,112.26. S&P 500 ended higher by 36.23 points (2.54%) at 1,462.42.
Many markets worldwide, including Asian, European and U.S. stocks were cheered by U.S. lawmakers coming to agreement on the fiscal cliff matter that had been overhanging the market place for weeks. U.S. lawmakers had to reach a deal to avoid a series of tax increases and spending cuts that would have automatically gone into effect last week.
After two days of strong rally, U.S. stocks ended moderately lower on Thursday, 03 January 2013. Stocks had kicked off New Year on a party mode as Wall Street embraced the last-minute move to d avoid going off the fiscal cliff of steep spending cuts and tax increases. But on Thursday, stocks slipped as Wall Street considered the recently reached budget deal and further moves were needed to curb the nation's red ink. The release of latest FOMC minutes hinting that Federal Reserve will likely end in 2013 its bond purchases also pressured stocks.
Stocks fell, as concern the budget deal won't reduce the deficit fast enough offset a better-than-forecast jobs report and a rally among retailers. Moody's Investors Service on Wednesday had said the budget accord will not reduce the nation's red ink enough to avert a sovereign-rating downgrade.
The minutes of the latest meeting of the Federal Reserve's Open Market Committee were released on Thursday afternoon and they somewhat surprisingly revealed some FOMC members believe that quantitative easing of U.S. monetary policy should be wound down during 2013.
U.S. stocks rose on Friday, 4 January 2013 after Congress passed crucial budget legislation and data showed the economy is continuing to add jobs at a moderate pace.
The Dow Jones Industrial Average rose 43.85 points, or 0.3%, to 13,435.21, with only six of its 30 components in negative territory. The technology-heavy Nasdaq Composite index gained 1.09 points, or 0.04%, to 3,101.66. The S&P 500 climbed 7.10 points, or 0.5%, to 1,466.47, its highest closing level since Dec. 31, 2007.
Financials and materials were the biggest gainers and information technology the biggest weight among the S&P 500's 10 major sectors.
Among economic data expected, the Labor Department said the U.S. added 155,000 jobs to nonfarm payrolls for December, slightly short of the 160,000 forecast by market. The unemployment rate was unchanged at 7.8%, suggesting the budget battle in Washington over the fiscal cliff didn't do much damage to the economy. The pace of hiring in December almost perfectly matched the level of job growth over the past two years. The U.S. has added an average of 153,000 jobs each month in both 2011 and 2012. The unemployment rate, originally reported as 7.7% in November, was revised to 7.8% after the Labor Department's annual seasonal adjustment conducted each December.
In the tech sector, shares of iPhone maker Apple were down 2.8%
On Friday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, rose by 0.1%.
Bullion metal prices ended substantially lower at Comex on Friday, 04 January 2013. Gold futures settled with a loss of 1.5% on Friday on signs the Federal Reserve could bring quantitative easing, one of the biggest boosts to gold's breathtaking run, to an end this year. Gold for February delivery fell $25.70, or 1.5%, to settle at $1,648.90 an ounce on the Comex division of the New York Mercantile Exchange on Friday. It fell by as much as $48 to touch a low of $1,626. Prices ended 0.4% lower for the week. Silver prices fell 77 cents or 3.25%, to settle at $29.95 an ounce, after having fallen more than 4% to touch a low of $29.24. It was down 0.1% from a week ago.
Crude Oil futures finished higher at Nymex on Friday, 04 January 2013. Prices rose finding support from a hefty drop in last week's U.S. crude supplies, but also pressured by a stronger dollar, as traders weighed concern over a potential end to the Federal Reserve's monetary stimulus this year.
Light and sweet crude-oil futures for delivery in February tacked on 17 cents, or 0.2%, to settle at $93.09 a barrel on the New York Mercantile Exchange. Prices, which traded between $91.52 and $93.15, climbed 2.5% for the holiday-shortened week.
The latest weekly inventory report by EIA showed that crude supplies fell by 11 million barrels. Market had expected a 1 million-barrel decline. The report also showed that motor gasoline supplies rose by 2.6 million barrels, while distillate stocks climbed 4.6 million barrels. Market had forecast a rise of 2.3 million barrels for gasoline inventories and a climb of 1.6 million barrels in distillate supplies, which include heating oil.
Around 651 million shares traded on the New York Stock Exchange. Composite volume topped 3.4 billion.
Indian ADRs ended mostly higher on Friday. In the Banking space, ICICI Bank was up 0.11% and HDFC Bank rose 0.51%. In the IT space, Infosys was down 1.8% and Wipro was down 1%. In the Telecom space, MTNL rose 8.7% and Tata Communication was down 0.1%. In the other space, Sterlite was down 1.6%, Tata Motors was down 1.6%. Dr Reddys was down 0.7%.
Next week, investors will turn their attention to fourth quarter earnings as Alcoa is scheduled to kick-off the earnings season after Tuesday's close.
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