Stocks gained Friday, narrowing the week’s losses as the energy and basic materials sectors improved and Dow components Exxon Mobil Corp. and Intel Corp. climbed on upgrades.
Volume was heavy as options expired, but advances were limited as investors eyed America’s current account deficit for April-June. The trade deficit dipped slightly, but still was at the second-highest level in history and on track to surpass last year’s record trade deficit of $668.1 billion. Foreign investors continued heavy buying of U.S. Treasury bonds in July, but economists worry that at some point they will no longer want to hold such sizable sums of dollar-denominated assets.
Gains were also capped by the University of Michigan’s midmonth report on consumer sentiment for September. Dow Jones said the survey, which is only available to subscribers, showed a steep decrease, but analysts wrestled with whether consumers would really change their spending habits, or whether they were just distraught by Hurricane Katrina.
The Dow Jones industrial average outpaced other indexes because it is more heavily weighted toward hot energy and basic materials stocks, said Ken Tower, chief market strategist for Schwab’s CyberTrader.
The Dow rose 83.19, or 0.79 percent, to 10,641.94.
Broader stock indicators were slightly higher. The Standard & Poor’s 500 index rose 10.18, or 0.83 percent, to 1,237.91, and the Nasdaq composite index rose 14.20, or 0.66 percent, to 2,160.35.
Bonds continued their decline, with the yield on the 10-year Treasury note rising to 4.27 percent from 4.22 percent late Thursday. The U.S. dollar was mixed against other major currencies. Gold prices rose, hitting a 17-year high.
Crude oil futures dipped. A barrel of light crude settled at $63, down $1.75 cents, in trading on the New York Mercantile Exchange.
Advancing issues led decliners by roughly 8 to 7 on the New York Stock Exchange, where volume was 2.55 billion, up from 1.55 billion Thursday.
The Russell 2000 index of smaller companies rose 6.56, or 0.99 percent, to 671.98.
Overseas, Japan’s Nikkei stock average fell 0.22 percent. Britain’s FTSE 100 rose 0.45 percent, Germany’s DAX index rose 1.64 percent, and France’s CAC-40 rose 0.67 percent.
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