Upward Momentum Leads To Modestly Higher Close On Wall Street - U.S. Commentary

(RTTNews) - After ending the previous session nearly flat, stocks moved modestly higher over the course of the trading day on Friday. While buying interest remained somewhat subdued, the Dow and the S&P 500 both reached new record closing highs.

The major average all posted slim gains on the day. The Dow ticked up 25.62 points or 0.2 percent to 16,947.08, the Nasdaq edged up 8.71 points or 0.2 percent to 4,368.04 and the S&P 500 crept up 3.39 points or 0.2 percent at 1,962.87.

For the week, the major averages all posted notable gains. The Dow advanced by 1 percent, while the Nasdaq and the S&P 500 jumped by 1.3 percent and 1.4 percent, respectively.

The modest strength on Wall Street came despite a lack of major catalysts and partly reflected the recent upward momentum for the markets, with the Dow and S&P 500 closing higher for the sixth consecutive session.

Nonetheless, an absence of U.S. economic news led to light trading activity as investors looked ahead to some key data due to be released next week.

Next week's data includes closely watched reports on new and existing home sales, durable goods orders, and personal income and spending.

The personal income and spending report includes a reading on inflation that is favored by the Federal Reserve and is likely to be in focus in light of recent reports showing notable price growth.

Despite the recent indications of rising prices, the Fed said inflation has been running below the monetary policy committee's longer-run objective.

In her post-meeting press conference on Wednesday, Fed Chair Janet Yellen acknowledged that recent inflation data has been on "the high side" but also described the data as "noisy."

Among individual stocks, shares of Oracle (ORCL) moved sharply lower on the day after the business software giant reported weaker than expected fourth quarter results.

Restaurant operator Darden Restaurants (DRI) also came under pressure after reporting fourth quarter earnings that came in below analyst estimates.

On the other hand, shares of Shire (SHPG) spiked higher on news the British drugmaker rejected a $46 billion takeover offer from AbbVie (ABBV), claiming it undervalued the company and its prospects.

Sector News

While most of the major sectors ended the day showing only modest moves, significant strength was visible among oil service stocks. The Philadelphia Oil Service Index surged up by 1.6 percent, reaching its best closing level in almost six years.

The strength among oil service stocks came amid a notable increase by the price of crude oil, with crude for July delivery climbing $0.83 to $107.26 a barrel.

Pharmaceutical, healthcare provider, and brokerage stocks also saw some strength, although buying interest remained subdued.

On the other hand, gold, tobacco, and utilities stocks moved lower on the day, helping to limit the upside for the broader markets.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance during trading on Friday. Japan's Nikkei 225 Index dipped by 0.1 percent, while Hong Kong's Hang Seng Index ticked up by 0.1 percent.

The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index rose by 0.3 percent, the French CAC 40 Index dropped by 0.5 percent and the German DAX Index edged down by 0.2 percent.

In the bond market, treasuries showed a lack of direction for much of the session before closing nearly unchanged. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.624 percent.

Looking Ahead

While the batch of economic data mentioned above is likely to be in focus next week, trading could also be impacted by any significant developments in Iraq.