Stock Prices Post Gains on Latest Economic Data
Stocks rebounded moderately Friday as a stronger than expected retail sales report showed that higher oil prices weren’t scaring consumers away from spending.
The Commerce Department reported that retail sales jumped 1.5% in September, much more than the 0.6% gain economists had forecast. Federal Reserve Chairman Alan Greenspan also soothed investors by saying surging energy costs would have less of an effect on the economy than the energy crisis of the 1970s.
The Dow Jones industrial average rose 38.93 points, or 0.4%, to 9,933.38.
Broader stock indicators were modestly higher. The Standard & Poor’s 500 index was up 4.91 points, or 0.4%, to 1,108.20, and the technology-focused Nasdaq composite index gained 8.48, or 0.5%, to 1,911.50.
Advancing issues outnumbered decliners by nearly 5 to 2 on the New York Stock Exchange.
For the week, the Dow lost 1.2%, the S&P; 500 fell 1.2% and Nasdaq was down 0.4%.
The retail sales rebound and Greenspan’s comments on oil pushed yields on U.S. Treasury notes higher. The yield on the 10-year government bond rose to 4.06%, from 4.02% on Thursday.
In other markets highlights:
* Crude oil hit a new closing record at $54.93 a barrel, up 17 cents, in New York trading.
* The insurance industry complaint and arrests announced by New York Atty. Gen. Eliot Spitzer on Thursday continued to take a bite out of insurance stocks. For the second day, American International Group had the biggest drop in the Dow average, falling $2.15 to $57.85, after tumbling 10% on Thursday. Two AIG executives were arrested in the probe.
Insurance broker Marsh & McLennan sank $5.65 to $29.20, after a 24% plummet the day before. National Financial Partners tumbled $3.31 to $30.10, after the advisory firm said it received two more subpoenas related to Spitzer’s probe.
* J.B. Hunt Transport Services climbed $1.34 to $38.16. The trucking company said third-quarter profit increased to 57 cents a share from 40 cents, exceeding analyst estimates. Other trucking companies rallied. Yellow Roadway, the biggest in the U.S., jumped $1.23 to $48.35. Werner Enterprises advanced $1.71 to $20.42.
* Shares of disk-drive maker Maxtor fell 94 cents to $4.44, after the Milpitas, Calif., company announced the unexpected resignation of its chief financial officer, Michael Bless. Bless is the second CFO to leave the company this year.
* Sprint jumped 38 cents to $20.68 after issuing a preliminary statement pointing to better-than-expected profit.
