Stocks Finish Record Week Mixed
Wall Street closed out a hot week on a mixed note Friday, with the majority of stocks falling even as major indexes hit new highs.
Elsewhere, most foreign markets were strong, while the dollar continued to lose ground. Bond yields inched higher.
The Dow Jones industrials gyrated in a modest range typical of a summer Friday, but still ended 9.78 points higher at 9,337.97, a record.
For the week, the blue-chip index rose 232.23 points, or 2.6%, lifting its 1998 gain to 18.1%.
The Nasdaq composite index also ended at a new high, one day after closing above the 2,000 mark for the first time.
The Nasdaq gained 8.20 points to 2,008.76 on Friday, its eighth straight record close, as leading tech stocks again advanced. For the week, the Nasdaq surged 3.4%. It’s up 27.9% year-to-date.
Also ending at a record Friday was the Standard & Poor’s 500, up 2.76 points to 1,186.75.
The relatively modest gains in the major indexes Friday suggested to some analysts that the powerful rally in big-name stocks since mid-June could be waning.
“It appears that the recent strong advance is coming to a halt,” said Joe Battipaglia, investment strategist at Gruntal & Co.
The broader market, in fact, was far less robust all week. The New York Stock Exchange composite index rose 1.5% for the week, versus the Dow’s 2.6% rise.
And demand for smaller stocks remains lackluster. The Russell 2,000 index added just 0.9% for the week.
On Friday, losers edged winners on both the NYSE and Nasdaq.
Still, analysts said strong second-quarter earnings reports from a host of companies this week, including Eastman Kodak, Microsoft and PepsiCo, helped allay investors’ concerns about the Asian economic crisis’ drag effect on U.S. businesses.
What’s more, cash flows into stock mutual funds still appear to be running at a high pace, some analysts say.
“There’s this insatiable desire to put money to work,” said Vince Farrell, chief investment officer at Spears, Benzak, Salomon & Farrell. “As long as interest rates stay low, investors are saying that prices don’t matter.”
The bond and dollar markets haven’t been so carefree this week. The 30-year Treasury bond yield ended at 5.72% on Friday, up from 5.63% a week earlier. And the dollar closed at 139.47 yen in New York, down from 140.93 a week earlier.
Both markets were affected by the surprise defeat of Japan’s ruling party in elections last Sunday. The defeat suggested Japan could be poised for serious reforms that could jump-start its economy--which could reduce demand for dollar-denominated assets.
What’s more, the dollar was hurt Friday by news that the U.S. trade deficit ballooned to a record in May. A widening deficit could hit the dollar in the long run.
Meanwhile, Japanese stocks eased Friday after a weeklong rally. Other Asian markets continued to rebound, with Taiwan up 1.4% and Singapore up 2%. European markets also were strong.
Among Friday’s highlights:
* Big tech names advancing included Sun Microsystems, up $2.06 to $52; EMC, up $4.19 to $52.44; and Microsoft, up 56 cents to $117.94, all in the wake of strong earnings.
On the downside, PMC-Sierra’s earnings disappointed, sending the stock down $7 to $39.88. Xilinx fell $4.31 to $37.06 on its profit report.
* The stunning debut of Internet-related stock Broadcast.com didn’t help the rest of the Internet sector. Yahoo fell 94 cents to $185.75 and Excite lost $3.25 to $88.38. But America Online leaped $5.38 to a record $128.
* Time Warner continued to lead the entertainment sector, soaring $4.69 to a record $99.63.
* Brokerage Charles Schwab rocketed $4.44 to $41.25 on vague takeover rumors.
* Hilton Hotels was active, as a 9-million-share block traded. The stock fell 31 cents to $26.56.
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Market Roundup, D4
