US stocks shrugged off mixed corporate results and eurozone worries to hold onto their gains on Friday, with the main indices all ending higher for the week despite little concrete positive news.
Despite some negative signs for global growth and US businesses expressing more concern about policy gridlock in Washington, traders clung to moderately positive data on jobs and housing as signs that the US economy was rebounding.
For the week the Dow Jones Industrial Average added 0.85 percent to reach 13,207.95; the S&P 500 gained 1.07 percent to 1,405.87; and the NASDAQ put on 1.78 percent to 3,020.86.
Analysts said that the previous week’s release of slightly upbeat job creation data for last month continued to underpin buying sentiment.
LACK OF CATALYSTS
“The market went significantly higher, and I think that with a lack of meaningful catalysts this week, this [jobs] sentiment continued as the week went on,” Michael James of Wedbush Morgan Securities said.
Even Friday’s poor data on Chinese exports and imports — which signaled the world’s second-largest economy was struggling to keep up growth — failed to dull the US exchanges.
Mining, tech, energy and capital goods stocks were the better-performing categories, while transport, utilities and healthcare lagged.
“The market has shown a tremendous resiliency in its ability to shrug off negativity recently,” James said.
“There is a little bit of negativity coming from China, in their data, that is causing a little bit of a market pullback ... but clearly the bullishness in the market remains,” he said.
Traders were still dubious of any weak story among stocks. Fabled British soccer club Manchester United cut its initial public offering price, but still failed to impress, with underwriters propping up the shares on their debut on Friday.
Analysts compared the richly priced offering to Facebook, which remained more than 40 percent below its May 18 launch.
While the week was slim on firm evidence for the direction of the US economy, the coming week’s numerous data releases could provide a better picture.
“What has helped the market this week has been the employment number from one week ago,” Hugh Johnson of Hugh Johnson Advisers said.
“We will now in the coming two weeks see more specific numbers ... on how the US economy did in the month of July. And they should be fairly upbeat. The market this week improved some, but not a lot, in anticipation of upbeat numbers for the next two weeks,” he said.
This week’s releases include consumer prices (Wednesday), industrial production (Wednesday), housing starts (Thursday), and leading indicators and consumer sentiment on Friday.