U.S. Stocks Close Mixed On The Day But Post Strong Gains For The Week

(RTTNews) - After moving mostly higher over the past few sessions, stocks saw further upside in early trading on Friday but gave back ground over the course of the day. The major averages pulled back well off their highs of the session before eventually closing mixed.

While the tech-heavy Nasdaq fell 63.54 points or 0.3 percent to 22,780.51, the S&P 500 crept up 0.44 points or less than a tenth of a percent to 6,715.79 and the Dow climbed 238.56 points or 0.5 percent to 46,758.28.

Despite the mixed performance on the day, the major averages posted strong gains for the week. The Nasdaq shot up by 1.3 percent, while the Dow and the S&P 500 both jumped by 1.1 percent.

The Dow and the S&P 500 closed higher for the sixth consecutive session, reaching new record closing highs. The continued advance by the Dow partly reflected strong gains by UnitedHealth (UNH), Travelers (TRV) and Caterpillar (CAT).

Meanwhile, the pullback by the Nasdaq came amid weakness among some big-name tech stocks such as Palantir (PLTR), which tumbled by 7.5 percent.

The plunge by Palantir came after a report from Reuters citing a recent internal U.S. Army memo said a modernization of the army's battlefield communications network being undertaken by Palantir and others is rife with "fundamental security" problems and vulnerabilities.

Shares of Tesla (TSLA) also slumped by 1.4 percent, while shares of Nvidia (NVDA) slid by 0.7 percent after ending Thursday's trading at a record closing high.

The lackluster performance by the broader markets came as the ongoing U.S. government shutdown has led to the indefinite delay of key U.S. economic data, including this morning's closely watched monthly jobs report.

However, weak data from non-government sources has increased confidence the Federal Reserve will continue cutting interest rates in the coming months.

After payroll processor ADP released a report earlier this week showing an unexpected decrease in private sector employment, the Institute for Supply Management released a report this morning showing a bigger than expected decline by its reading on service sector activity.

The ISM said its services PMI fell to 50.0 in September from 52.0 in August, with a reading of 50.0 serving as the breakeven point between expansion and contraction. Economists had expected the index to edge down to 51.7.

CME Group's FedWatch Tool is currently indicating a 96.7 percent chance the Fed will cut rates by a quarter point in October and an 84.9 percent chance of another quarter point rate cut in December.

Sector News

Reflecting the lackluster close by the broader markets, most of the major sectors ended the day showing only modest moves.

Healthcare stocks showed a notable move to the upside, however, with the Dow Jones Health Care Index climbing by 1.1 percent to its best closing level in over six months.

Telecom, banking and airline stocks also saw some strength on the day, while retail and semiconductor stocks moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. While Japan's Nikkei 225 Index surged by 1.9 percent, Hong Kong's Hang Seng Index fell by 0.5 percent.

Meanwhile, European stocks moved mostly higher on the day. The U.K.'s FTSE 100 Index advanced by 0.7 percent and the French CAC 40 Index rose by 0.3 percent, although the German DAX Index bucked the uptrend and dipped by 0.2 percent.

In the bond market, treasuries moved back to the downside after trending higher over the past few sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 3.1 basis points to 4.119 percent.

Looking Ahead

Developments in Washington may impact next week's trading, while traders are also likely to keep an eye on a preliminary reading on consumer sentiment in October as well as the minutes of the latest Federal Reserve meeting.