U.S. equities edged higher on Friday amid a slew of upbeat earnings reports, mixed durable goods data and a lackluster consumer sentiment reading. Utilities and Telecomm led gains on the S&P 500, while Healthcare and Staples lagged. Gold and Oil are slightly higher.
The S&P 500 has gained 23.3% so far this year, just shy of the 23.5% jump the index posted in 2009. Surpassing the 2009 record would give the index its biggest annual gain in a decade. Today the benchmark index logged its third-straight week of gains.
In U.S. economic news, data showed orders for a wide range of U.S.-made capital goods dropped in September and consumer sentiment weakened sharply in October, suggesting the political impasse in Washington has affected both consumer and business confidence.
New orders of non-military capital goods other than aircraft, an indicator of business spending plans, fell 1.1% last month, and orders for durable goods, which include everything from toasters to tanks, fell 0.1% when factoring out transportation equipment. The bright spot came from a surge in volatile aircraft orders which pushed overall orders of long-lasting factory goods 3.7% higher, beating consensus of 2.5%.
Worries over the economic fallout also pushed U.S. consumer sentiment in October to its lowest level since the end of last year, according to the University of Michigan's final reading of consumer sentiment for the month. The survey's index fell to 73.2 in October from 77.5 in September. It was the lowest final reading since December 2012.
Market Indices/Statistics:
- Dow closed up 61.07 pts/ +0.39% to 15,570.28; 21 of the 30 Dow stocks closed higher.
- S&P closed up 7.70 pts/ +0.44% to 1,759.77; all of the 10 S&P 500 sectors closed higher.
- Nasdaq closed up 14.40 pts/ +0.37% to 3,943.36
- Utilities were the strongest sector (+1.12%), Healthcare was the weakest (+0.14%).
- The VIX is down 0.10 at 13.10
- Gold is up 1.5 to 1351.7
- Oil is up 0.90 to 98.01
- Nat Gas is up 0.070 to 3.895
- Euro vs. Dollar is up 0.0005 to 1.3804
- Yen vs. Dollar is up 0.13 to 97.40
Top Headlines:
Shares of DuPont (NYSE: DD, $61.90, +0.85%) jumped sharply on the open of trading after the firm announced on Thursday plans to spin off its performance-chemicals business into an independent, publicly-traded company. DuPont said the move, which had been sought by Wall Street, will allow it to better focus on the growth area of specialty materials and agriculture.
Callaway Golf Co. (NYSE:ELY, $8.70) rose 19.83% as the maker of golf clubs and golf balls raised its 2013 profit and sales forecasts while reporting a smaller-than-expected quarterly loss, helped by improved gross margins and operating expenses. The stock also received analyst upgrades from Wedbush and DA Davidson.
Moody's Corporation (NYSE: MCO, $71.56) reported an improvement in third-quarter revenue from a year earlier, thanks to strength in its corporate finance and analytics businesses, yet income came in flat and results missed views. The ratings and analytics company also narrowed its earnings guidance for the year sending shares 2.24% lower.
Microsoft Corp (MSFT, $35.70) was the leading gainer on the Dow, Nasdaq and S&P 500 as profit and revenue reported late Thursday handily topped Wall Street expectations. Shares rose $1.98 or 5.87%.
The week ahead: Oct 28th– Nov 1st
Q3 earnings continue into next week with another round of notable releases from Tech, Energy, Pharma and the Life Insurance space. However, the corporate calendar is not expected to be a big directional driver given that the majority of higher-profile themes have been released.
Monetary policy is likely to capture some headlines, though the market is not expecting anything new from either the Federal Reserve or Bank of Japan meetings. In terms of the former, the focus is likely to be on the extent to which the FOMC highlights the latest fiscal headwinds in its policy statement.
The official China PMI and the US ISM manufacturing report should get most of the attention on the economic calendar while labor market data will be limited to ADP private payrolls and initial claims, with the official BLS employment report for October pushed back a week until 8-Nov.
Coming Monday
U.S. Economic Reports:
Industrial Production (Sept) at 9:15am, consensus +0.5%, prior +0.4%
Capacity Utilization (Sept) at 9:15am, consensus 78.1%, prior 77.8%
Pending Home Sales (Sept) at 10:00am, prior (1.6%)
Earnings Monday:
BMO: Edwards Lifesciences (EW) Est. 0.66c; Loews Corporation (L) Est. 0.77c; Merck (MRK) Est. 0.88c; Roper Industries (ROP) Est. $1.45
AMC: Apple (AAPL) Est. $7.91; FMC Corp (FMC) Est. 0.82c; Hartford Financial (HIG) Est. 0.84c; Macerich (MAC) Est. 0.83c; Masco (MAS) Est. 0.25c; Plum Creek (PCL) Est. 0.42c; Seagate Technology (STX) Est. $1.31
Here at the NYSE
At the open:
On Monday, October 28, San Francisco-based Charles Schwab Investment Managementwill visit the New York Stock Exchange(NYSE) to mark the recent launch of its Schwab Fundamental Index ETFs, which began trading on August 15:
To highlight the occasion, Charles Schwab Investment Management President and CEO Marie Chandoha will ring the NYSE Opening Bell, joined by members of the Charles Schwab Investment Management leadership team, partners, clients, and index and research providers.
At the close:
On Monday, Oct. 28, Owens Corning, led by Chairman and CEO Michael H. Thaman and members of the company’s leadership team, will visit the New York Stock Exchangeand ring The Closing Bellto commemorate the company’s 75thanniversary.
Please remember to check in with us every morning for the NYSE Morning Update! http://exchanges.nyx.com/parasnand-madho/nyse-morning-update-05022013
Thanks and enjoy the weekend!
