Encouraging company earnings have propelled Wall Street stocks to their best levels in a month, but concerns over a slowing economy are expected to continue dogging markets.
Over the week, the blue-chip Dow Jones Industrial Average jumped 3.2 percent to end Friday at 10,424.62 ?a feat accomplished only once since April 30.
The tech-rich NASDAQ composite index soared 4.2 percent to 2,269.47 while the S&P 500 index, a broad measure of the markets, scaled 3.5 percent to 1,102.66, finishing atop the 1,100 level for the first time since June 21.
?ot a bad way to end the week,?Schaeffer? Investment Research senior technical strategist Ryan Detrick said.
?e saw some more encouraging earnings, and it was another step in the right direction?for an upward-trending bull market, he added.
The gains were chalked up on impressive earnings by key US companies, including construction equipment manufacturer Caterpillar, IT behemoths Microsoft and Apple, automaker Ford and banking giant Morgan Stanley.
Against the positive earnings, conglomerate General Electric also announced a 20 percent quarterly dividend jump.
?ased on the second-quarter earnings reports and guidance, the US is not headed for a double-dip recession,?said analyst Patrick O?are at Briefing.com, assuaging concerns over the pace of recovery in the world? largest economy.
?ur sense is that the biggest concern out there is that the US stock market is poised to suffer another large decline. It seems to us then that the biggest surprise at this juncture would be a melt-up in the stock market, not a meltdown,?O?are said.
Federal Reserve Chairman Ben Bernanke warned this week that the US economy faced an ?nusually uncertain?outlook, saying the central bank could step in if the recovery fails.
Most recent government and private data pointed to a noticeable slowdown in economic activity.
?o questions lingered about the sustainability of the earnings momentum in the second half of 2010,?IHS Global Insight US 苟conomists Brian Bethune and Nigel Gault said in a report.
?he general expectation is that [economic] growth will slow down further in the third quarter,?they said.
The government is expected to provide the US GDP growth rate in the second quarter on Friday.
Most analysts expect the economy to grow by 2.5 percent in the April-June period from 2.7 percent in the first quarter.
Stuart Freeman, Wells Fargo chief equity strategist, said the economic slowdown was expected to be ?nly a temporary stumble?in the recovery, but added that many market participants were uncertain.
?he result of this uncertainty will likely be a continuation of the volatile day-to-day trading we have witnessed over the last few months,?he said.
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