Stocks closed with small gains Friday, largely shaking off worries about scheduled federal budget cuts kicking in at midnight Friday. Investors appeared to instead focus on several better-than-expected economic reports, and reversed slight declines early in Friday's session after a new measure of consumer attitudes surged in February while U.S. factory activity also rose last month. Healthcare and consumer discretionary stocks had the best gains, offsetting declines for shares of energy and materials companies after crude oil and most metals fell in commodities trading.
Friday's advance was supported by the Thomson Reuters/University of Michigan consumer sentiment climbing 2.5 points to a 76.3 final reading for February, topping expert opinion by a small margin. The survey found consumer attitudes about current conditions adding 3 points to an 88.0 score with future expectations also rising by 2.1 points to a 68.7 reading.
Also Friday, the Institute for Supply Management said its manufacturing index rose 1.1 points to a 54.2 reading for February, beating the median forecast of experts in a Bloomberg survey. The surprise gain stands in contrast to a similar report showing manufacturing in China slowed for a second month in a row while factory output in euro-zone countries contracted for a 19th consecutive month.
Consumer spending in the U.S. rose in January even as incomes dropped by the most in 20 years, showing households were weathering the payroll-tax increase by socking away less money in the bank.
President Obama met with Congressional leaders in a last-minute bid to avoid the sequester budget cuts although the sides, as expected, came away from the talks concluding they would take effect as scheduled at midnight local time in Washington. In a news conference following the late-morning talk, the President again called on a "balanced" approach of eliminating tax loopholes with spending cuts while House Speaker John Boehner flatly dismissed that approach, saying "The President got his tax hikes in January."
Commodities are mostly lower, with crude oil for April delivery settling $1.37 lower at $90.68 per barrel, sliding $2.45, or about 2.6%, in price this week. April natural gas was down 3 cents to $3.46 per 1 million BTU. April gold was off $5.80 to $1,572.30 per ounce while May silver added 6 cents to finish at $28.49 per ounce. May copper was down 5 cents, settling at $3.50 per pound.
Here's Where The U.S. Markets Stood At Day's End
- Dow Jones Industrial Average up 35.17 (+0.25%) to 14,089.66
- S&P 500 up 3.53 (+0.23%) to 1,518.21
- Nasdaq Composite Index up 9.55 (+0.30%) to 3,169.74
- Hang Seng Index down 0.61%
- Shanghai China Composite Index down 0.26%
- FTSE 100 Index up 0.28%
- (+) MTG, Mortgage insurer's chief executive Officer said the company may soon raise capital to reduce its risk-to-capital ratio that currently is above regulatory limits.
- (+) DECK, Forecasts FY13 sales that top analyst forecasts. Q4 EPS of $2.77 per share also beats the Street view by $0.20.
- (+) PGH, Reports 55% increase in proved plus probable reserves to the equivalent of 512 mln barrel of oil at the end of 2012 from the prior year-end levels.
- (+) GRPN, Sacks CEO Andrew Mason, naming board executive chairman and company co-founder Eric Lefkofsky and Vice Chairman Ted Leonsis to the Office of the Chief Executive until a permanent replacement is found.
- (-) ENMD, Sells 4.495 mln equity units priced at 2.40 each in a $10.3-mln direct offering to institutional investors, including the Kleiner Perkins Caufield Byers and IDG-Accel. Each unit contains one share of ENMD stock and one-half warrant to purchase another share.
- (-) EVEP, Reports Q4 net loss of $0.23 per share, reversing $0.27 per share profit in the year-ago quarter and trailing analyst forecasts for a $0.47 profit. Revenue climbs 13% to $75.5 mln, also trailing estimates by $9.8 mln.
- (-) FDML, Auto parts-maker cut to Sell from Neutral at Goldman Sachs, which also lowered its price target by $4 to $5 a share.
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