By Ken Sweet, Damian J. Troise, and Alex Veiga
Stocks are closing higher Friday after a late surge by technology stocks led the S&P 500 to a new high. The wobbly week of trading ended with the Dow Jones Industrial Average and Nasdaq at record highs also. Investors focused on trillions of dollars of potential government aid that could be coming for the economy, as Democrats advance their stimulus package. Companies reported solid earnings, including manufacturer Mohawk Industries and genetic testing company Illumina. Bond yields rose, giving banks a boost. Bumble shares continued to climb after the company’s IPO the day before.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Major U.S. stock indexes wavered between small gains and losses Friday, as the market closed in on its second straight weekly gain after a wobbly week of trading.
Wall Street remains focused on trillions of dollars of potential government aid that could be coming for the economy, as Democrats move forward with their stimulus package.
The S&P 500 index was down less than 0.1% as of 2:13 p.m. Eastern. The Dow Jones Industrial Average slipped 57 points, or 0.2%, to 31,373. The Nasdaq composite inched up less than 0.1%. The Russell 2000 index of small companies was also up less than 0.1%. The major indexes remain near the all-time highs each set earlier this week.
The muted moves follow several days of minor gains and losses for the broader market, but every major index is still on track for a weekly gain ahead of a long weekend. U.S. stock and bond markets are closed Monday for Washington’s Birthday.
Investors are hoping for a new round of U.S. government aid as the economic recovery falters. The latest U.S. government report on jobless claims reaffirmed that employment remains a weak spot in the economy, even as vaccine distribution ramps up in the hopes of eventually ending the pandemic. The University of Michigan survey of consumer sentiment came in well below expectations as well, a sign that consumers are wary to spend in the face of economic uncertainty.
Investors do not expect the market to move substantially higher in the near term until there's more clarity on the future of government stimulus and the direction of the U.S. economy. Democrats have decided to use a legislative process that does not require Republican support to pass the $1.9 trillion package.
“We’re sort of awaiting catalysts,” said Jeffrey Kleintop, chief global investment strategist at Charles Schwab. “The market is still of the opinion that there will be a vaccine-led, broad economic recovery in the second half of this year.”
A majority of companies have now reported their latest round of earnings and the results have been surprisingly good. Roughly 75% of companies in the S&P 500 have released results, showing overall growth of 2.8%, according to FactSet. That's a sharp reversal from the 13% contraction analysts had forecast in late September.
Mohawk Industries shares climbed 5.5% after the company posted stronger-than-expected quarterly earnings. Genetic analytics company Illumina jumped 13.3% for one of the biggest gains in the S&P 500 following its encouraging earnings report.
Bumble shares rose a further 13.5%, extending big first-day gains Thursday on the company's initial public offering.
Banks made some of the strongest gains as bond yields rose, which allow them to charge more lucrative interest on loans. The yield on the 10-year Treasury rose to 1.20% from 1.16% late Thursday. Wells Fargo gained 2.1%.
Most Asian markets were closed to mark the Lunar New Year and European markets closed higher.
Updated on February 12, 2021, at 4:22 p.m. ET.