The financials and tech sectors led gainers
U.S. stocks closed slightly higher on Friday, 14 October 2016 finishing near lows of the session to turn in a second losing week in a row, after a trio of quarterly bank results topped analyst estimates and Federal Reserve Chairwoman Janet Yellen said there may be benefits to running the economy with a tight labor market.
The Dow Jones Industrial Average closed up 39.44 points, or 0.2%, at 18,138.38, for a 0.6% loss on the week. The S&P 500 index advanced 0.43 points to finish at 2,132.98, for a 1% decline on the week. The Nasdaq Composite index finished up 0.83 points at 5,214.16, for a 1.5% decline on the week.
On Friday, the financials and tech sectors led gainers. Goldman Sachs rose 1.9% and was the top performer on the Dow.
After a brief spike, stocks returned to levels seen just before Yellen's speech and remained there until the near the end of the trading session, when stocks pared gains and the S&P 500 and the Nasdaq flirted with slipping into negative territory. In a speech in Boston on Friday, Yellen said it might be wise to run a high pressure economy, one with a tight labor market, to reverse the negative effects of the Great Recession.
J.P. Morgan Chase & Co. dipped 0.3% after both its earnings and revenue topped analyst forecasts, though the results were still down from the prior year. Similar results were seen at Citigroup which closed up 0.3% after its quarterly report. Wells Fargo & Co. shares closed down 0.1%. While its results were ahead of expectations, questions continue to swirl following its sales-tactics scandal that led to the departure of the company's CEO John Stumpf earlier this week.
Data showed that consumer sentiment in early October, however, took a hit as concerns about the presidential election began to weigh, according to the University of Michigan. Friday's economic data included the PPI Report for September, the Retail Sales Report for September, Business Inventories for August, and the initial reading of the University of Michigan Consumer Sentiment Index for October. The Producer Price Index (PPI) for September showed a 0.3% increase in final demand prices (consensus +0.2%), led by a 0.7% jump in the index for final demand goods. Excluding food and energy, the index for final demand was up 0.2% (consensus +0.1%).Total retail sales increased 0.6% in September while sales, excluding autos, rose 0.5%. Both results were in-line with the estimates.
Separately, the University of Michigan's Index of Consumer Sentiment dropped to 87.9 in the preliminary reading for October (consensus 92.4) from the final reading of 91.2 for September. The October reading is the second lowest level in the past two years.
Crude oil futures slipped on Friday, 14 October 2016 but managed a fourth consecutive week of gains as traders eyed a decline in U.S. crude production for the lower 48 states to a level not seen in more than two years. Futures also found some support from sizable weekly drawdowns in domestic gasoline and distillate stockpiles, which include heating oil, reported by the Energy Information Administration on Thursday, although inventories of crude oil climbed for the first time in six weeks.
November West Texas Intermediate crude lost 9 cents, or 0.2%, to settle at $50.35 a barrel on the New York Mercantile Exchange. For the week, prices rose 1.1%, after posting gains in each of the last three weeks.
December Brent crude on London's ICE Futures exchange, the global benchmark, fell 8 cents, or 0.2%, to $51.95 a barrel, and ended higher for the week by less than 0.1%.
Latest data showed that domestic crude production for the lower 48 states fell by 36,000 barrels a day to 7.969 million barrels a day. That is the lowest level since June 2014.
On Friday, strength in the ICE U.S. Dollar Index which rose 0.5% as of gold's settlement, put some pressure on dollar-denominated commodities. It was set for a gain of about 1.4% for the week.
Bullion prices ended lower at Comex on Friday, 14 October 2016. Gold futures settled lower on Friday as the dollar climbed on the back of upbeat U.S. retail sales data, but scored their first weekly gain in three weeks.
December gold fell $2.10, or 0.2%, to settle at $1,255.50 an ounce. Gold futures ended the week about 0.3% higher. December silver fell 1.7 cents, or 0.1%, to $17.441 an ounce, holding on to a nearly 0.4% gain on Friday.
Friday's trading volume fell came in below the recent average of 862 million as 785 million shares changed hands at the NYSE floor.
Monday's economic data will include the 8:30 a.m. ET release of October Empire Manufacturing (consensus 2.0). The Industrial Production (consensus 0.2%) and Capacity Utilization (consensus 75.6%) report for September will be released at 9:15 a.m. ET.
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