Stocks finished mostly higher Friday despite news of a terrorist attack against a Saudi Arabian oil-processing plant. Oil jumped and gold prices surged.
Before trading opened, two explosives-laden cars attempted to destroy a plant in Abqaiq in eastern Saudi Arabia. Although officials said the flow of oil wasn’t halted, the attacks sent crude futures up sharply, with the price of a barrel settling at $62.91, up $2.37, in New York trading.
Wall Street was subdued on the news, but most key indexes still ended the day higher, and rising stocks outnumbered losers by about 3 to 2 on the New York Stock Exchange.
The Dow Jones industrial average slipped 7.37 points, or 0.1%, to 11,061.85, but the Standard & Poor’s 500 edged up 1.64 points, or 0.1%, to 1,289.43, and the Nasdaq composite gained 7.72 points, or 0.3%, to 2,287.04.
Two indexes of smaller shares, the Russell 2,000 and the S&P; 600, edged up to record highs.
“One of the most important signs of a bull market is when the bull market manages very, very bad news like we’ve had today,” said Hugh Johnson, chief investment officer of Johnson Illington Advisors. “So in that sense, you’ve got a very encouraging performance today.”
A government report showing a sharp drop in durable goods orders in January failed to shake optimism about the economy. Excluding transportation goods, orders were up 0.6%.
The economy’s strength has underpinned the stock market in recent months, and helped push the Dow to a 4 1/2 -year high Wednesday. But that strength also is worrying some investors because of concerns about inflation, and whether the Federal Reserve might have to tighten credit more significantly than Wall Street already expects.
“The concern is, will the Fed raise rates too high and slow things down?” said Nick Calamos, who co-manages the $19.6-billion Calamos Growth Fund in Naperville, Ill.
Shorter-term Treasury bond yields ended the week at multiyear highs, reflecting that traders believe the Fed almost certainly will raise its key rate, now 4.5%, to 4.75% at its late-March policy meeting, analysts said.
The six-month T-bill yield ended at 4.72%, unchanged from Thursday but up from 4.68% a week earlier.
The 10-year T-note ended at 4.57%, up from 4.56% on Thursday and 4.54% a week earlier.
For the week, the Dow fell 0.5%, while the S&P; gained 0.2% and Nasdaq also rose 0.2%.
Among the day’s highlights:
* Higher oil prices boosted the energy sector. Occidental Petroleum rose $2.38 to $92.38, Noble Energy gained $1.53 to $43.48 and ConocoPhillips added $1.29 to $62.73.
* Gold futures soared after the Saudi attacks, with near-term futures rising $10.40 to $558.80 an ounce in New York. Among gold mining stocks, Agnico Eagle jumped $1.04 to $26.63 and Newmont Mining was up $1.54 to $58.10.
* Some retailers were under pressure. Gap fell 67 cents to $18.43 a day after saying it fourth-quarter profit fell 11%.
Nordstrom lost $1.72 to $38.30 after its report late Thursday that it expected first-quarter profit of 39 cents to 44 cents a share, less than the average estimate of 45 cents from analysts surveyed by Thomson Financial. On Friday the stock was cut to “hold” from “buy” at Deutsche Bank, which said Nordstrom shares “are fully valued.”
But shares of Kohl’s rallied $2.35 to $46.86. The retailer had a fourth-quarter profit of $1.08 a share, beating the average estimate of analysts by 1 cent.
* Intel was downgraded to “market perform” from “outperform” by Friedman Billings Ramsey, and its price target was lowered to $23 a share from $31, but the battered stock nonetheless rose 7 cents to $20.36.
* H&R; Block fell $2.18, or 8.7% to $23.01. The tax preparer lowered its per-share profit forecast for fiscal 2006, saying customer traffic in its 12,200 tax stores this year was slower than expected.
* Dana, the top maker of axles for light trucks, dropped for a fourth day after postponing a decision on paying its 1-cent-a-share cash dividend for the first quarter. Dana slumped $1.64 to $1.51, extending its drop for the week to 64%.