Closing Market Summary: Equities End the Week on a Positive NoteAfter posting its worst one-day loss in eight months on Wednesday (-1.8%), the stock market ended the week with two bounce-back performances that left the S&P 500 with just a modest loss for the week (-0.4%). The benchmark index challenged its flat line for the week at the peak of Friday's slow and steady climb, but couldn't hold its session high into the closing bell. The major averages settled in the middle of the day's trading range with the S&P 500 and the Dow adding 0.7% apiece. The Nasdaq (+0.5%) settled just a tick below its peers.
Thursday's positive sentiment lingered in the stock market on Friday morning, granting the major averages modest gains at the opening bell. From there, the industrials (+1.4%), energy (+1.2%), and financials (+0.8%) groups led the stock market in a slow and steady climb. The industrial sector rallied around Deere's (DE 120.90, +8.23) stronger than expected earnings and upbeat guidance. DE shares jumped 7.3% while peer Caterpillar (CAT 102.43, +2.21) also profited from the positive sentiment, adding 2.2%.
Crude oil underpinned the energy sector's positive performance, jumping 2.0% to $50.33/bbl, after reports that an OPEC panel is considering the possibility of not only extending its deal to cut oil production, which Russia and Saudi Arabia spoke in favor of earlier in the week, but also increasing the size of the production cut. For the week, the energy component added 5.2%.
The financial sector held strong into the final hour of action but lost some of its vigor following a Washington Post report that claims a White House official is a person of interest in the investigation on Russia's influence in the U.S. presidential election. The broader market was in the midst of challenging last Friday's closing level before the report was released, but ticked down with the financial sector in the aftermath.
All eleven sectors ended the day in the green, but some groups showed relative weakness with the top-weighted technology sector (+0.5%) being the most notable laggard. The tech group failed to capitalize on chipmakers' relatively upbeat performance, evidenced by the 1.1% increase in the PHLX Semiconductor Index, as mega-cap names like Apple (AAPL 153.06, +0.52) and Microsoft (MSFT 67.69, -0.02) weighed. Salesforce.com (CRM 87.40, -0.35) also underperformed despite beating top and bottom line estimates.
In the currency market, the euro (1.1202) added 0.9% against the U.S. dollar after European Central Bank President Mario Draghi said late on Thursday that the eurozone crisis is now in the past and that the recovery was resilient and increasingly broad-based. The euro/dollar pair settled at a seven-month high while the U.S. Dollar Index (97.03, -0.74) finished at its lowest level since early November.
U.S. Treasuries saw some selling pressure amid the stock market's rebound performance, leaving the benchmark 10-yr yield one basis point higher at 2.23%. However, the CBOE Volatility Index (VIX 12.18, -2.48, -16.9%) better captured the day's risk-on tone, dropping over two points.
Investors did not receive any economic data on Friday. Monday's economic calendar is also blank.
- Nasdaq Composite +13.0% YTD
- S&P 500 +6.4% YTD
- Dow Jones Industrial Average +5.3% YTD
- Russell 2000 +0.8% YTD