NEW YORK – U.S. stocks had a mixed close Friday, after investors were torn between worries about weaker than expected durable goods orders and an attempted attack on a Saudi oil refinery on the one hand – and a desire to take advantage of investment opportunities on the other hand.
The Dow Jones Industrial Average ($INDU) gave up a late session effort to move higher and closed down 7.37 points at 11061.85. The S&P 500 Index ($SPX) rose 1.64 points to 1289.43 as the Nasdaq Composite Index ($COMPX) gained 7.72 points to 2287.04.
For the week the Dow Jones Industrials fell 0.5 percent and the S&P 500 and Nasdaq Composite both gained 0.2 percent.
Stocks throughout the week have tried to come to terms with a complicated clutch of both positive and worrisome developments.
“Earlier this week, we came within a whisker of multiyear highs for the S&P 500,” said Peter Boockvar, equity strategist at Miller Tabak. “But the market still has a lot of headwinds. We’re still near the upper end of a trading range.”
Paul Nolte, director of investments at Hinsdale Associates, said there were many cross-currents in the market. “We have higher oil prices. But we also have an economy that seems to be doing OK – not terrific, but not as bad as the original report of 1.1 percent gross domestic-product growth,” Nolte said.
He predicted the market will have difficulty getting outside its trading range in the near term and probably will require an outside event to break out.
In another sign of the complexity of the current market, Nolte noted that there continues to be strong buying interest in many individual shares, but there also are significant money flows into mutual funds that short the overall market.
Mike Holland, manager of the Holland Balanced Fund, characterized the day’s price action Friday as signs of a resilient market, in light of the attempted assault on the Saudi oil facility.
The BBC said the attack was the first direct assault on Saudi oil production.
The explosion came from Saudi security officials shooting at a vehicle packed with explosives. The attempted attack later was reported as thwarted.
Also Friday, the Commerce Department reported a 10.2 percent plunge in durable goods orders for last month, citing weak aircraft orders.
The decline, the largest since July 2000, far exceeded the 2.5 percent drop expected by economists. Aircraft orders fell 68.2 percent in January after averaging more than three times the normal level from October through December.
Oil futures were on the rise, adding $2.37, or 3.9 percent, to close at $62.91 a barrel after the news from Saudi Arabia. Continuing concerns about violence at Nigerian oil installations and escalating tensions in Iraq also drove up crude prices.
Gold futures climbed on safe-haven demand after the Saudi news. The front-month contract closed up $6.60 at $554.60 an ounce.
Treasury prices finished weaker, giving up morning gains after investors parsed the details of the durable goods report and noted that the decline was linked mainly to a drop in Boeing aircraft orders, while orders in other sectors remained strong.
The benchmark 10-year note ended down 2/32 at 99 13/32 with a yield ($TNX) of 4.5691 percent.
The yen extended a rally begun on Thursday, after Bank of Japan Governor Toshihiko Fukui reiterated hawkish comments about the interest rate outlook in the world’s second-largest economy.
The dollar fell 0.2 percent to 116.91 yen as the euro fell 0.4 percent to $1.1868.
Dow component Home Depot Inc. (HD) closed 5 cents higher at $41.63. The stock had opened higher after announcing late Thursday a $1 billion increase in its stock-buyback program.
Intel Corp. (INTC), also in the Dow, managed to finish 0.5 percent higher at $20.40. Earlier it was pressured by a downgrade to market perform and a price target cut to $23 from $31 from Friedman Billings Ramsey.
Late Thursday, Gap Inc. (GPS) reported that fourth-quarter earnings fell 11 percent to $337 million, or 39 cents a share. Sales fell to $4.82 billion from $4.89 billion. The company also lowered its full-year profit projection, excluding stock-option expenses, to a range of $1.20 to $1.24 a share. The stock fell 3.5 percent to $18.43.
Kohl’s Corp. (KSS) jumped 5.3 percent higher to $46.86 after the retailer posted a rise in fourth-quarter earnings.
There was heavy selling in the auto sector, as shares of parts maker Dana Corp. (DCN) lost more than half its value, dropping $1.64 to close at just $1.51 after a Wall Street Journal report that the company is working with a restructuring adviser.
Shares of Dow component General Motors Corp. (GM) fell 2.9 percent to $19.99 and Visteon Corp. (VC) gave up 5.2 percent to $4.73.
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AP-NY-02-24-06 1727EST
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