Investors looked past a spike in oil prices Friday, sending stocks higher on the strength of Ford Motor Co.’s bullish profit outlook. The major indexes finished the week mixed.
Ford’s outlook was somewhat of a surprise since the automaker announced cutbacks in production earlier this month. A number of large companies, especially in the technology and industrial sectors, have downgraded their earnings guidance for the third quarter due to soft demand, renewing worries on Wall Street that the summer’s economic slowdown would continue.
Wall Street managed to hold on to its gains Friday despite oil prices rising back above $45 per barrel, driven by lost capacity from the Gulf of Mexico in the wake of Hurricane Ivan. A barrel of light crude settled at $45.59, up $1.71, on the New York Mercantile Exchange.
“Considering how high oil has gotten, the market is acting pretty strong,” said Todd Leone, managing director of equity trading at SG Cowen Securities. “I don’t know how sustainable it is, but for now, it’s nice to see.”
The Dow Jones industrial average rose 39.97, or 0.4 percent, to 10,284.46.
Broader stock indicators were modestly higher. The Standard & Poor’s 500 index was up 5.05, or 0.4 percent, at 1,128.55, and the Nasdaq composite index gained 6.01, or 0.3 percent, to 1,910.09.
For the week, the Dow fell 0.3 percent, reversing five weeks of gains, while the S&P 500 was up 0.4 percent and the Nasdaq rose 0.8 percent. It was the sixth straight positive week for the S&P 500 and the second week of gains for the Nasdaq.
Blue chips were hit hard earlier in the week by a disappointing profit outlook from Dow component Coca-Cola Co., while rising oil prices and muddled economic data kept the other indexes’ gains to a minimum.
In addition, some investors likely kept to the sidelines in advance of Tuesday’s Federal Reserve meeting, where the Fed was expected to raise the nation’s benchmark interest rate by a quarter percentage point. Interest rates currently stand at 1.5 percent.
The latest reading of the University of Michigan’s consumer sentiment index gave investors another conflicting reading on the state of the economy. The index fell slightly to 95.8 in September, down from 95.9 in August, showing that consumers are still worried about jobs and incomes. Wall Street had forecast a 96.7 reading.
With consumer spending a key component of the economy, Michigan’s latest reading on consumer sentiment was disappointing. Consumer spending has been skittish through the summer, especially for big-ticket items like appliances and cars, due to persisting high energy prices.
Advancing issues barely outnumbered decliners on the New York Stock Exchange, where volume came to 1.43 billion shares, compared with 1.11 billion on Thursday.
The Russell 2000 index of smaller companies was down 1.38, or 0.2 percent, at 573.16.
Overseas, Japan’s Nikkei stock average lost 0.5 percent. In Europe, Britain’s FTSE 100 closed up 0.8 percent, France’s CAC-40 rose 0.9 percent for the session, and Germany’s DAX index gained 0.6 percent.