MARKET SNAPSHOT: U.S. Stocks Tread Water; Home Sales Disappoint

Date : 08/23/2013 @ 2:04PM
Source : Dow Jones News
Stock : Nasdaq, Inc. (NDAQ)
Quote : 80.07  0.24 (0.30%) @ 6:03PM

MARKET SNAPSHOT: U.S. Stocks Tread Water; Home Sales Disappoint

Nasdaq, Inc. (NASDAQ:NDAQ)
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By Wallace Witkowski and Victor Reklaitis, MarketWatch

SAN FRANCISCO (MarketWatch) -- U.S. stocks were treading water Friday, with blue chips getting a big boost from Microsoft's CEO news, after shaking off losses following disappointing new-home-sales data.

The main indexes remained on pace for a mixed performance for the week, which featured a three-hour trading halt in Nasdaq-listed stocks.

The S&P 500 index (SPX) rose 4 points, or 0.2%, to 1,661, while the Dow Jones Industrial Average(DJI) rose 25 points, or 0.2%, to 14,989. Microsoft Corp.(MSFT) provided a boost to the blue-chip index as it jumped 7% and fared best among Dow components, advancing on news that CEO Steve Ballmer will retire within 12 months.

The Nasdaq Composite(RIXF) rose 15 points, or 0.4%, to 3,653.

For the week, the S&P 500 was showing a gain of 0.3%, the Dow a loss of 0.6%, and the Nasdaq an advance of 1.4%.

The main indexes, which all had traded in positive territory earlier in the morning, were set back on the release of new-home sales data, which was much weaker than expected.

As investors digested the housing data, stocks started clawing their way back into positive territory, likely treating the poor numbers as an argument for delaying tapering of the Federal Reserve's asset purchases.

Two Fed officials offered mixed comments in CNBC interviews from the Fed's conference near Jackson Hole, Wyo., early Friday, with Atlanta Fed Bank President Dennis Lockhart backing a September taper with a caveat, and St. Louis Fed President James Bullard saying there's no reason to hurry the taper, which refers to the central bank's much-anticipated reduction in its bond buys. Follow our streaming coverage.

The market is latching onto this uncertainty and treating the housing data as another data point supporting a delay of tapering, said Mark Luschini, chief investment strategist at Janney Montgomery Scott.

"To the extent they haven't made their minds up, this is a data point you have to chalk up to deferring tapering for now," Luschini said.

The key issue at Jackson Hole, which runs until Saturday, is the looming question of whether Larry Summers or Fed Vice Chair Janet Yellen will replace Bernanke. Here are five speakers to pay attention to at the conference. Also: 5 things Ben Bernanke could do in his next life

Advancing stocks outpaced decliners by about 3 to 2 on the New York Stock Exchange, while decliners edged out advancers slightly on the Nasdaq. Composite volume topped 1.5 billion shares for NYSE-listed stocks and 962 million shares for Nasdaq-listed stocks as of 1:45 p.m. Eastern.

In addition, investors were taking in upbeat German and U.K. GDP data, as well as Nasdaq OMX Group Inc.'s (NDAQ) CEO saying he's dedicated to improving the exchange's performance after Thursday's three-hour trading halt.

On the corporate front, shares of Pandora Media Inc. (P) fell 12% after the streaming-music provider gave a weaker-than-expected earnings outlook late Thursday.

Shares of Aéropostale Inc. (ARO) tumbled 20% after the teen-apparel retailer reported weak earnings and a sour third-quarter outlook. A day earlier saw disastrous results from Abercrombie & Fitch Co. (ANF).

U.S. stocks closed higher on Thursday, gaining slightly after Nasdaq-listed companies resumed trading after a stoppage due to technical difficulties that lasted more than three hours.

Nasdaq OMX's CEO, Robert Greifeld, on Friday said the exchange was "deeply disappointed with what happened yesterday." Speaking in an interview with CNBC, Greifeld said the Nasdaq had handled the trading problem "in a logical and organized way."

In a statement after the close Thursday, Nasdaq OMX said most of the shutdown was spent figuring out the market reopen, rather than dealing with technical problems. Actual issues were resolved within 30 minutes, but planning time was needed "to ensure an orderly reopening of trading." Also read: Nasdaq outage a "black squirrel event."

In Asia, the Nikkei Stock Average rallied 2.2% as the yen weakened against the dollar, but Chinese stocks retreated over concerns about liquidity. European stocks moved higher Friday after earlier getting no lift from German growth data, which showed a rebound in the second quarter. U.K. stocks were up after an upward revision for second-quarter GDP growth in that country.

Crude oil and gold prices traded higher.

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