Benchmarks ended Friday's choppy trading session higher, boosted by General Electric's positive quarterly results and an upbeat consumer sentiment report. The S&P 500 closed at its highest level since Aug 20. The index also recorded its third successive week of gains, its longest three-week winning streak since May. This was the first time since February that the Dow and Nasdaq posted three consecutive weeks of gains.
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The Dow Jones Industrial Average (DJI) rose 0.4% to close at 17,215.97. The Standard & Poor's 500 (S&P 500) gained nearly 0.5% to close at 2,033.11. The tech-laden Nasdaq Composite Index closed at 4,886.69, rising 0.3%. The fear-gauge CBOE Volatility Index (VIX) declined 6.2% to settle at 15.05. A total of around 6.6 billion shares were traded on Friday, lower than the last 20-sessions' average of 7.5 billion. Advancers outpaced declining stocks on the NYSE. For 58% stocks that advanced, 40% declined.
Benchmarks edged up on Friday, helped by gains in General Electric Company ( GE ). Shares of the industrial conglomerate gained 3.4% after the company reported third quarter earnings per share of 32 cents, beating the Zacks Consensus Estimate by 6 cents. Revenues for the reported quarter were $31,680 million, exceeding the Zacks Consensus Estimate of $28,666 million.
Friday's gains were broad based with 11 out of 12 sectors of the S&P 500 sectors ending in the green. The Real Estate Select Sector SPDR (XLRE) gained 1.9%, the highest among the S&P 500 sectors. Key stocks from the sector including Equinix, Inc. ( EQIX ), Ventas, Inc. ( VTR ), The Macerich Company ( MAC ), CBRE Group, Inc. ( CBG ) and Weyerhaeuser Co. ( WY ) increased 2.2%, 1.8%, 1.7%, 1.7% and 1.7%, respectively.
Consumer sentiment data also lifted benchmarks on Friday. The Thomson Reuters/University of Michigan's preliminary October consumer sentiment reading came in at 92.1. The preliminary reading was higher than the consensus estimate of 88.9.
The Consumer Staples Select Sector SPDR ETF (XLP) advanced almost 1% and was the second biggest gainer among the S&P 500 sectors. Key consumer staples stocks including The Procter & Gamble Company ( PG ), The Coca-Cola Company ( KO ), Philip Morris International, Inc. ( PM ), Pepsico, Inc. ( PEP ) and CVS Health Corporation ( CVS ) increased 0.9%, 0.2%, 1.9%, 1.4% and 0.9%, respectively.
Meanwhile, investors shrugged off discouraging industrial production report. The Board of Governors of the Federal Reserve System reported that industrial production fell 0.2% in September after decreasing 0.1% in August. However, the decline was narrower than the consensus estimate of a decrease by 0.3%. Separately, capacity utilization decreased to 77.5%, as against consensus estimate of 77.3%.
For the week, the S&P 500, the Dow and the Nasdaq gained 0.9%, 0.8% and 1.2%, respectively. Gains in financial stocks helped benchmarks end the week in the green. Citigroup Inc.'s ( C ) encouraging third quarter earnings results along with a strong recovery in The Goldman Sachs Group, Inc.'s ( GS ) shares despite disappointing quarterly results had a positive impact on the financial sector. Separately, JPMorgan Chase & Co.'s ( JPM ) third quarter earnings results turned out to be discouraging.
Meanwhile, a jump in healthcare stocks also boosted investor sentiment. Gains in utilities sector offset slump in energy shares last Monday. Reduced rate hike concerns in October's Federal Reserve meeting, boosted utilities stocks. Fears of a rate hike ebbed further following last month's dismal inflation data.
Among the negatives, Wal-Mart Stores Inc.'s ( WMT ) disappointing revenue outlook for fiscal 2016 dragged benchmarks to the red on Wednesday. Moreover, decline in Producers Price Index (PPI) and an in-line retail sales report raised concerns about the health of the US economy. Slump in gasoline prices dragged down PPI in September, while retail sales excluding auto sales numbers witnessed a decline last month.
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