By Stephen Culp
NEW YORK (Reuters) - U.S. stocks closed higher on Friday, with the S&P 500 and the Dow Jones Industrial Average extending gains and the Nasdaq turning positive on reports of progress in tariff disputes between the United States and its trading partners China and Mexico.
Chinese and U.S. negotiators are planning talks to resolve their trade row ahead of meetings in November, the Wall Street Journal reported on Friday. Additionally, Mexico's economy minister, Ildefonso Guajardo, said he hopes to wrap up outstanding bilateral issues on the North American Free Trade Agreement (NAFTA) by the middle of next week.
"The threat of a trade war threatens economic activity," said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. "The fact that the administration might resolve (trade disputes) sooner rather than later, without a sustained time frame of slower economic actively due to tariffs, that bodes well for the market."
Trade-vulnerable industrial stocks led advances by the S&P 500 and the Dow, with the S&P 500 industrial sector gaining 0.6 percent. The sector was led higher by a 2.3 percent rise in Caterpillar Inc (N:CAT) shares.
For the week, the S&P and the Dow posted weekly gains, but the Nasdaq showed a loss for the same period.
Following bleak forecasts, shares of Nvidia Corp (O:NVDA) and Applied Materials Inc (O:AMAT) fell 4.9 percent and 7.7 percent, respectively, pushing the Philadelphia SE Semiconductor index (SOX) 0.7 percent lower.
Among the so-called FAANG group of momentum stocks, all but Apple Inc (O:AAPL) fell. The smartphone maker gained 2.0 percent to an all-time closing high.
Netflix Inc (O:NFLX) posted its sixth consecutive loss. In addition to Apple and Netflix, the FAANG group includes Facebook Inc (O:FB), Amazon.com (O:AMZN) and Google parent Alphabet Inc (O:GOOGL).
Shares of Tesla Inc (O:TSLA) dropped 8.9 percent, their worst day in over two years after Chief Executive Elon Musk's interview with the New York Times and a UBS note saying the company could lose $6,000 on every base Model 3 sedan due to powertrain costs.
The Dow Jones Industrial Average (DJI) rose 110.59 points, or 0.43 percent, to 25,669.32, the S&P 500 (SPX) gained 9.44 points, or 0.33 percent, to 2,850.13 and the Nasdaq Composite (IXIC) added 9.81 points, or 0.13 percent, to 7,816.33.
Second-quarter earnings season is approaching the finish line. Of the 467 companies in the S&P 500 that have reported, 79.2 percent have beaten consensus estimates, according to Thomson Reuters I/B/E/S.
All 11 major sectors in the S&P 500 were in positive territory.
Bucking the otherwise downbeat department store earnings trend, shares of Nordstrom Inc (N:JWN) jumped 13.2 percent after posting better-than-expected same-store sales and raising its profit forecast.
Deere & Co's (N:DE) shares rose 2.4 percent after quarterly results missed analysts' estimates due to higher raw materials and freight costs.
Advancing issues outnumbered declining ones on the NYSE by a 2.45-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favored advancers.
The S&P 500 posted 38 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 83 new highs and 69 new lows.
Volume on U.S. exchanges was 6.06 billion shares, compared with the 6.53 billion average over the last 20 trading days.