Stocks gained for a second straight week as companies began releasing earnings reports, keeping the Standard Poor’s 500-stock index within a fraction of its highest level in five years.
The S. P. 500 was little changed Friday, gaining 5 points during the week to close at 1,472.05. On Thursday, the index was at 1,472.12, its highest level since December 2007.
The Dow Jones industrial average rose 17.21 points, to 13,488.43. The Nasdaq composite index rose 3.87 to 3,125.63. For the week, the Dow rose 53 points and the Nasdaq rose 24 points.
Companies have started to report earnings for the fourth quarter of 2012, but no clear pattern has emerged as yet. The aluminum company Alcoa gave stocks a lift after it reported earnings late Tuesday that matched analysts’ expectations and said that demand was increasing. Investors were unimpressed by Wells Fargo’s record profits Friday, choosing instead to focus on the sustainability of those earnings.
“You’ve been hearing comments that earnings season is going to show a continued contraction in the rate of growth,” said Robert Pavlik of Banyan Partners. “People are conflicted, they are worried, but at the same time they don’t want to be missing out on the action” in the market.
Analysts expected fourth-quarter earnings for S. P. 500 companies to grow by 3.3 percent, according to the latest data from SP Capital IQ. That was a better growth rate than the previous quarter, but it was considerably weaker than the 8.4 percent rate in the same period last year.
Stock in Wells Fargo, the first major bank to report earnings, dropped after it reported a 25 percent increase in fourth-quarter earnings. Its shares fell 30 cents, or 0.9 percent, to $35.10. JPMorgan Chase, Goldman Sachs, U.S. Bancorp, Citigroup and Bank of America were among the financial companies set to report earnings next week.
Financial stocks were the best-performing group in the S. P. 500 last year, gaining 26 percent. Other companies reporting next week include eBay and Intel.
The Treasury’s benchmark 10-year note rose 9/32, to 97 27/32, and the yield fell to 1.87 percent from 1.90 percent late Thursday.
Article source: http://www.nytimes.com/2013/01/12/business/stocks-slip-after-5-year-high.html?partner=rss&emc=rss
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