Stocks rise sharply on Black Friday to end best week of year
Forget the malls. Investors snapped up shares on Black Friday, giving the stock market its best week of the year.
Traders were in a buying mood amid early reports from retailers like Wal-Mart Stores Inc. suggesting a strong turnout on the official start of the holiday shopping season. The retail industry makes about 40% of its annual sales during the next few months, and that jump in consumer spending could mean a big boost to the U.S. economy.
Major U.S. stock indexes ended a shortened trading session up more than 1.3% on the day and 3% for the week. The Dow Jones industrial average rose above 13,000 for the first time since Nov. 6.
“The question will be, when the numbers are tallied, if U.S. consumers are spending as much as they did last year,” said Quincy Krosby, a market strategist at Prudential Financial. “Each year the U.S. consumer seems to defy expectations.”
Traders were also encouraged by positive economic news from Germany and China, two engines of global growth. Technology stocks soared after a few weeks of selling, highlighted by big gains in Hewlett-Packard and BlackBerry maker Research in Motion.
But retailers were among the biggest movers during the session, as Black Friday is seen as an indicator of how much consumers are going to spend during the holidays.
Wal-Mart, which drew criticism for opening on Thanksgiving, reported serving 22 million customers and racking up the biggest Black Friday sales on record. The Bentonville, Ark., retail giant’s shares added $1.31, or 1.9%, to $70.20.
The Dow rose 172.79 points, or 1.4%, to 13,009.68, as investors poured $200 billion into the stock market Friday. The broader Standard & Poor’s 500 index gained 18.12 points, or 1.3%, to 1,409.15. The technology-heavy Nasdaq composite index rose 40.30 points, or 1.4%, to 2,966.85.
The rally gave the S&P; 500 its biggest weekly point gain since December — 49 points, or 3.6%. The Dow gained 3.4% and the Nasdaq almost 4% for the week.
Volume was light and trading confined to half a day. Low trading volumes generally mean greater swings up or down in market indexes.
Investors hammered Hewlett-Packard this week after the computer and printer maker reported losing money in the last quarter because of a massive $8.8-billion write-down stemming from financial misstatements by a British software company it acquired. The tech giant’s stock recovered Friday, gaining 50 cents, or 4%, to $12.44.
Research in Motion saw its shares surge on upbeat expectations for its next-generation BlackBerry 10 smartphone. RIM stock rose $1.40, or 14%, to $11.66.
The so-called fiscal cliff will again take center stage next week as President Obama and congressional leaders wrangle over a budget deal to stave off automatic spending cuts and tax increases.
In Europe, a measure of Germany’s business climate gave investors hope that the continent’s strongest economy could withstand the continuing Eurozone debt crisis.
“Companies expressed slightly greater satisfaction with their current business situation,” the Ifo Institute said in its November report. “They were also far less pessimistic about future business developments. The German economy is holding up in the face of the euro crisis.”
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