Stocks Inch Lower; S&P 500 Slips From 5-Year High
Jan 11th 2013 12:15PM
Updated Jan 11th 2013 12:25PM
By STEVE ROTHWELL
NEW YORK (AP) - Stocks edged lower on Wall Street Friday, pulling the Standard & Poor's 500 index below a five-year high reached the day before.
The S&P 500 fell two points to 1,470 as of noon Eastern. It closed at 1,472 Thursday, its highest level since December 2007. The Dow Jones industrial average fell a point to 13,469. The Nasdaq composite index dropped three points to 3,119.
Wells Fargo (WFC), the first major bank to report earnings, dropped even after the bank reported a 25 percent increase in fourth-quarter earnings, as analysts questioned the sustainability of the banks' profits. The bank's stock fell 40 cents to $35.
Boeing (BA) fell $1.77 to $75.32 after the U.S. Federal Aviation Administration said it is launching a comprehensive review of the critical systems of Boeing's 787, the aircraft maker's newest and most technologically advanced plane, after a fire and a fuel leak earlier this week.
The stock market got a boost Thursday from reports suggesting the outlook for economic growth may be improving. European Central Bank President Mario Draghi said the struggling euro zone should start growing again later this year and a report showed that China, the world's second-biggest economy, may gradually be emerging from its worst economic downturn since the 2008 global crisis.
Stocks are up on the year after a lawmakers came up with a last-minute deal to prevent the U.S. from going over the "fiscal cliff," averting the threat of a series of tax hikes and spending cuts that economists say would almost certainly have pushed the U.S. economy into recession.
Avoiding the "cliff" will likely have boosted consumer confidence, said Chris Kichurchak, vice president at Strategic Wealth Partners. That improving sentiment, combined with a strengthening housing market, should prove favorable to so-called cyclical companies that move in line with the economy.
"There are a lot of people who were holding out on spending," before a budget deal was struck, said Kichurchak.
The yield on the 10-year Treasury note, which moves opposite to the security's price, rose 1 basis point to 1.91 percent.
Other stocks making big moves;
- American Express (AXP) rose 21 cents to $60.98 after the company said that spending by cardholders jumped 8 percent in the fourth quarter, even after Superstorm Sandy crimped some buying.
- Best Buy (BBY) jumped $1.41 to $13.62 after the struggling consumer electronics chain reported holiday sales. The company's U.S. performance was flat and, while this was a hair below the 0.3 percent increase Best Buy reported in the prior-year period, it was an improvement over the past several quarters.
- Ford (F) rose 13 cents to $13.96 for a third day. The company said demand for new vehicles is accelerating in the U.S. Ford plans to hire 2,200 engineers, computer programmers and other white-collar workers this year. The automaker said Thursday it was raising its dividend.