Stocks end higher following economic readings
NEW YORK (AP) - Wall Street closed out the week with a moderate gain after better than expected economic data placated a market pummeled a day earlier by concerns about housing and the financial sector.
The government said sales of new single-family homes fell by 0.6 percent to a seasonally adjusted annual rate of 530,000 units; the market expected sales to total 505,000. A barometer of consumer confidence also came in better than expected.
The Dow Jones industrial average is ending up 22 at the 11,371 level.
The Commerce Department's report on June home sales helped investors shake off some early uncertainty. And there was good news about consumers, whose shyness about spending has troubled Wall Street. The Reuters/University of Michigan index of consumer sentiment for the first part of July came in at 61.2, while economists forecast a reading of 56.4, which was the level hit in June a 28-year-low.
The Commerce Department also said orders for durable goods rose 0.8 percent last month, far better than the 0.4 percent decline economists expected. It was the best showing since a 1.1 percent rise in February and reflected strength in demand for heavy machinery, primary metals such as steel and even a slight rebound in the beleaguered auto industry.
Linda Duessel, equity market strategist at Federated Investors, said economic figures such as the durable goods numbers are important because they reveal continued demand from abroad, which could help U.S. companies continue to rake in profits even if the U.S. economy isn't running at full steam.
"That's good news for market participants as we try to find a footing in the market because we really don't want to see our weakness leak outside the U.S.," she said.
Meanwhile, a barrel of light sweet crude fell $2.23 to settle at $123.26 on the New York Mercantile Exchange. Oil prices have fallen over $20 in recent weeks, alleviating some of Wall Street's concerns about the impact of inflation consumers' ability to spend.
In the final hour of trading, the Dow Jones industrial average fell 13.60, or 0.12 percent, to 11,335.68. The Dow, which had also fluctuated in early trading, fell more than 280 points Thursday.
Broader stock indicators rose. The Standard & Poor's 500 index advanced 1.37, or 0.11 percent, to 1,253.91. The technology-heavy Nasdaq composite index jumped 26.43, or 1.16 percent, to 2,306.54.
Bond prices moved lower as investors shifted back into stocks. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 4.09 percent from 4.00 percent from late Thursday.
The dollar was mixed against other major currencies, while gold prices rose.
The stock market's volatility this week rallying Tuesday and Wednesday only to erase those gains Thursday illustrates tentativeness behind some of the bets investors are laying, said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors. He said the market tends to react to whatever the latest headlines are.
"It's just news sensitive and the real question is 'What's the next news going to be? Good or bad?' That means that the market doesn't have a trend or a direction. It depends entirely on whether the news is going to be good or bad on any given day and that doesn't give you, as an investor, a lot of confidence," he said.