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U.S. Stocks Close Mostly Higher Following Another Choppy Trading Day

wallstreet aug20 18nov22 lt

Stocks failed to sustain an initial move to the upside and showed a lack of direction over the course of the trading session on Friday. The choppy trading on the day extended the volatility seen over the past several sessions.

The Dow climbed 199.37 points or 0.6 percent to end the day at 33,745.69, and the S&P 500 rose 18.78 points or 0.5 percent to 3,965.34. Meanwhile, the Nasdaq spent the day bouncing back and forth across the unchanged line before closing up just 1.10 points or less than a tenth of a percent at 11,146.06

For the week, the Dow was nearly unchanged, while the S&P 500 slid by 0.7 percent and the Nasdaq slumped by 1.7 percent.

"U.S. stocks are acting like they are already feasted on a 12-pound turkey," said Edward Moya, senior market analyst at OANDA. "Today's market moves were uninspiring as we did not learn anything new."

The initial strength on Wall Street partly reflected a positive reaction to upbeat earnings news from some big-name companies.

Apparel retailer Gap (GPS) moved sharply higher after unexpectedly returning to profitability in the third quarter on sales that exceeded analyst estimates.

Shares of Foot Locker (FL) also spiked after the athletic footwear and apparel retailer reported better than expected third quarter results and raised its full-year guidance.

Discount retailer Ross Stores (ROST) and cybersecurity company Palo Alto Networks (PANW) also posted standout gains after reporting quarterly results that beat expectations.

Buying interest waned shortly after the start of trading, however, with some disappointing U.S. economic data weighing on the markets.

The National Association of Realtors released a report showing a substantial decrease in existing home sales in the month of October.

NAR said existing home sales plummeted by 5.9 percent to an annual rate of 4.43 million in October after slumping by 1.5 percent to a rate of 4.71 million in September.

Existing home sales decreased for the ninth consecutive month, resulting in a 28.4 percent nosedive compared to the same month a year ago.

A separate report released by the Conference Board showed a much bigger than expected decrease by its reading on leading U.S. economic indicators in the month of October.

The Conference Board said its leading economic slumped by 0.8 percent in October after falling by a revised 0.5 percent in September. Economists had expected the index to decrease by 0.4 percent, matching the drop originally reported for the previous month.

Noting the index fell for the eight straight month, Ataman Ozyildirim, Senior Director, Economics, at The Conference Board, said the data suggests the economy is "possibly in a recession."

Sector News

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Utilities stocks showed a strong move to the upside, however, with the Dow Jones Utility Average surging by 2.3 percent.

Significant strength was also visible among networking stocks, as reflected by the 2.2 percent jump by the NYSE Arca Networking Index.

Tobacco, healthcare and commercial real estate stocks also moved notably higher, while energy stocks moved to the downside amid a steep drop by the price of crude oil.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index edged down by 0.1 percent, while South Korea's Kospi inched up by 0.1 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the German DAX Index shot up by 1.2 percent, the French CAC 40 Index jumped by 1.0 percent and the U.K.'s FTSE 100 Index rose by 0.5 percent.

In the bond market, treasuries came under pressure over the course of the session after initially showing a lack of direction. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 4.3 basis points to 3.818 percent.

Looking Ahead

The Thanksgiving Day holiday may lead to light trading activity next week, although traders are still likely to keep an eye on reports on durable goods and new home sales as well as the minutes of the latest Federal Reserve meeting.

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