The blue-chip Dow Jones industrial average rose 64.64 points, or 0.71%, to 9,191.09. The broader Standard & Poor's 500 index gained 3.47 points, or 0.36%, to 977.59. The tech-heavy Nasdaq composite index was down 8.15 points, or 0.49%, to 1,644.03.
For the week, the Nasdaq posted a 4.2% decline, compared with a 0.26% decline for the S&P 500 and a 0.4% increase for the Dow average. According to Standard and Poor's economists David Wyss and Rick MacDonald, weakness resulted from a number of converging factors: among them, a spike in bond yields, labor market concerns, and profit-taking as a strong earnings season wound up.
On Friday, fast food chain McDonald's (MCD
) supported the Dow average. Shares in McDonald's rose 8% Friday after the company announced higher July sales.
Another strong performer Friday was Spanish-language media company Univision (UVN
). After Thursday's close, Univision reported higher second-quarter earnings on slightly lower revenues. CIBC World Markets upgraded the stock, which rose 13% on Friday, to "sector outperform."
Among other companies in the news, graphics chip maker NVIDIA (NVDA
) lowered its fourth-quarter guidance. The shares fell almost 20% Friday.
Weakness in NVIDIA hurt semiconductor stocks, which as a group underperformed Friday. For instance, shares of chip giant Intel (INTC
) and equipment maker Applied Materials (AMAT
) both traded lower.
Animation studio Pixar (PIXR
) reported higher second-quarter profits on the strength of its box-office hit "Finding Nemo." Pixar shares traded near flat after it cut its full-year earnings per share guidance.
On the commodities front, oil prices moved higher to levels not reached since before the start of the Iraq war. Traders continued to worry about supply shortfalls from Iraq.
Gold prices also moved higher, benefitting gold stocks. Denver-based Newmont Mining (NEM
) hit an all-time high stock price on Friday.
No major economic data was released Friday. Next week, investors look forward to the Federal Open Market Committee meeting on Aug. 12. Also expected are data on: July retail sales, June business inventories, the June trade balance, weekly initial jobless claims, and July industrial production and capacity utilization. Rounding out the week are the July trade price indexes, July producer price index, July consumer price index, and the August University of Michigan consumer price index.
Among major companies expected to report quarterly earnings next week are media outfit Martha Stewart Living Omnimedia (MSO
), consumer products maker Clorox (CLX
), farm equipment manufacturer John Deere (DE
), energy company Williams (WMB
), mega-retailer Wal-Mart (WMT
), and computer merchant Dell (DELL
Profit taking pushed prices of U.S. Treasuries mostly lower Friday afternoon. Prices had risen after Thursday's completion of the Treasury's $60 billion quarterly refunding. The benchmark 10-year note's yield was 4.29%.
Traders had an eye toward the Aug. 12 meeting of the Federal Open Market Committee. Economic research outfit MMS International expects rates to be held steady.
"Despite signs of improving growth, we believe the Fed will again say that the risks to the economy are in balance, not wanting to be premature on the recovery's acceleration," notes MMS. "And even though deflation risks have been minimized, the seemingly more vocal minority on the FOMC may want to say there is still risk, albeit minor, of an unwelcome fall in prices, especially as inflation remains benign."
European stock markets were higher Friday. In London, the Financial Times-Stock Exchange 100 added 52.2 points, or 1.27%, to 4,147.8, amid sentiment that an economic recovery was gaining traction. In Germany, the DAX Index gained 0.35 points, or 0.01%, to 3,332.24. Short covering nudged German stocks higher. In France, the CAC 40 was up 34.93 points, or 1.12%, to 3,165.49.
In Asia, major stock indexes ended mixed. Japan's Nikkei index finished up 61.97 points, or 0.67%, to 9,327.53, led by advances in some high-tech stocks. Volume was light ahead of next week's "Obon" vacation in Japan. Meanwhile, Hong Kong's Hang Seng index fell 12.83 points, or 0.13%, to 9,945.22.