U.S. Stocks Edge Higher

By Dow Jones Business News, 
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By Matt Jarzemsky

U.S. stocks edged higher, putting the Dow Jones Industrial Average within range of a record closing high.

The Dow rose 37 points, or 0.2%, to 16588, slightly above its April 30 record closing high of 16580.84. The Dow remained below its all-time intraday high of 16631.63, hit on April 4.

The S&P 500 index tacked on two points, or 0.1%, to 1878. The Nasdaq Composite Index gained 13 points, or 0.3%, to 4064, erasing earlier losses of as much as 0.6%.

With little economic news to digest and the end of earnings season drawing near, investors have been tweaking single-stock holdings but doing little in the way of broad market bets, traders say. While earnings growth has been sluggish, recent improvements in labor-market and manufacturing data have many investors sticking with stocks. As a result, major benchmarks have wavered near their recent record highs.

"It is an absence of buying. That's significant in itself in terms of how little conviction there is" that the market is headed higher, said Jeffrey Yu, head of U.S. single-stock derivatives trading at UBS AG.

Mr. Yu said he'd seen many customers replacing stocks holdings with options contracts that provide exposure to the same stock but provide some protection against the chance share prices fall.

The S&P 500 is down 0.3% on the month, while the Dow is little changed in that time frame. Conversely, the Nasdaq Internet Index has fallen 9.6% in the past month and the Russell 2000 index of small companies' shares is down 5.3%, reflecting investors' continued aversion to shares of fast-growing technology firms that had led the latest stage of the rally through the start of this year.

In single-stock news, Ralph Lauren fell 2.5% Friday after giving a quarterly revenue forecast that trailed analysts' average projections.

Gap rallied 4% after the apparel retailer reported late Thursday April same-store sales growth that was well above expectations and provided an upbeat first-quarter earnings outlook.

Advertising technology company Rocket Fuel tumbled 26% after giving a disappointing revenue forecast.

Apple fell 1% after reports surfaced late Thursday that the technology giant was in talks to buy Beats Electronics. The Wall Street Journal reported Apple could pay more than $3 billion for the high-end headphone maker.

On the economic front, wholesale inventories for March rose a more-than-expected 1.1%.

Elsewhere in global markets, the 10-year Treasury note's yield edged up to 2.616% from 2.601% late Thursday. Gold futures gained 0.3% to $1,291.80 an ounce, and crude-oil futures tacked on 0.4% to $100.61 a barrel. The dollar gained some ground against the euro and the yen.

European markets were broadly lower. The Stoxx Europe 600 fell 0.3%, after closing at a six-year high on Thursday on hopes the European Central Bank will introduce new stimulus measures next month to combat low inflation.

Data showed that Germany's trade surplus was smaller than expected in March as exports declined, while first- quarter factory output in the U.K. grew at the fastest pace for a quarter in nearly 15 years.

In Japan, the Nikkei Stock Average edged up 0.3%.

Write to Matt Jarzemsky at matt.jarzemsky@wsj.com


  (END) Dow Jones Newswires
  05-09-141328ET
  Copyright (c) 2014 Dow Jones & Company, Inc.


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