By Kate Gibson
U.S. stocks ended higher on Friday after waging a dramatic
comeback in the final hour of trade, spurred by gains in
commodities.
"It's less driven by an influx of bargain hunters and more the
exhaustion of sellers," Art Hogan, chief market strategist at
Jefferies & Co., said of the late surge.
Reversing course after a nearly 170-point drop earlier, the Dow
Jones Industrial Average (DJI) added 10.05 points, or 0.1%, to
10,012.23, leaving the blue chips with a 0.6% weekly loss.
The S&P 500 Index (SPX) gained 3.08 points, or 0.3%, to
1,066.19, down 0.7% for the week.
The Nasdaq Composite Index (RIXF) rose 15.69 points, or 0.7%, to
2,141.12, leaving it off 0.3% from the week-ago close.
The market was beset through most of the session by concerns
about the creditworthiness of European governments.
But around 3 p.m. Eastern, the market started to shift alongside
a rebound in oil prices in electronic trading and a
better-than-expected reading of U.S. consumer credit.
"The sovereign debt story will play out for a long time, but the
U.S. market has over-reacted, and is now back in lockstep with the
dollar and commodities," said Hogan.
March oil futures recently traded at $71.86 a barrel after
ending the floor trading session at $71.19 per barrel, the lowest
close since Dec. 15.
Traders also said that automated orders also seemed to kick in
late in the day, as sometimes happens in the last hour of trading.
After an increasingly volatile run lately, including a sharp
two-day pullback coming into Friday's trading, the market has
become an increasingly attractive playground for short-term
participants who use such computer-based orders.
The Dow saw three triple-digit full-day point moves this week.
The performance has frustrated traders who focus on earnings and
big-picture U.S. data, which have often been overshadowed lately by
concerns about economic policy in major industrialized countries
around the world.
In U.S. economic news, a much-anticipated employment report was
better than some investors had feared. The U.S. unemployment rate
unexpectedly fell to 9.7% last month from an unrevised 10% in
December, the Labor Department said. Economists expected the
jobless rate to edge higher, to 10.1%.
Still, the jobs data didn't point unequivocally to a
strengthening labor market as the number workers on nonfarm
payrolls continued to edge lower.
"The real impetus is that the economy is not off to the races,"
said David Klaskin, chief investment officer of Oak Ridge
Investments. "Even though we've had some really nice data points,
they don't necessarily reflect a prolonged recovery."
Concerns have swirled the last few days regarding the financing
of governments in Greece, Portugal, and Spain. Though those worries
faded into the background as Friday's trading played out, the euro
was still under some pressure recently, trading at $1.3664, down
from $1.3741 late Thursday.
The Dollar Index (DXY), which represents the greenback against a
basket of six currencies, jumped 0.9%.
Some investors pulled out of stocks that could open lower on
Monday if European governments make headlines over the weekend,
said John Brady, senior vice president of global interest rates at
MF Global. The potential that European banks could announce further
problems with funding or real-estate loans is prompting traders to
clear their portfolios of risky assets before the market closes, he
said.
"There's potential for an intensification of political pressures
in the euro zone," Mr. Brady said.
Among stocks to watch, Airgas Inc. (ARG) soared 40% after rival
Air Products & Chemicals (APD) offered $5.1 billion, or $60 a
share, for the industrial-gas company. Air Products shares fell
6.9%.