Stocks close flat after volatile week
U.S. stocks ended the day little changed Friday, letting investors breathe a little easier after a week in which both the highs and lows were extreme.
The market gave investors a hard jolt the first two days of trading this week on concerns about the health of China’s economy. The rebound Wednesday and Thursday was just as sharp as investors decided to scoop up beaten-up stocks.
The relatively stable Friday trading offered the owners of bruised portfolios some hope that the market was settling down.
“People are taking a little bit of a pause,” said Paul Springmeyer, senior portfolio manager at the Private Client Reserve at U.S. Bank. “We’re finally winding down here where maybe we’re seeing more rational behavior.”
The Dow Jones industrial average fell 11.76 points, or 0.1%, to 16,643.01 on Friday.
The Standard & Poor’s 500 index rose 1.21 point, or 0.1%, to 1,988.87. The Nasdaq composite gained 15.62 points, or 0.3%, to 4,828.32.
U.S. oil prices moved sharply higher for a second day, boosting energy stocks.
Bond prices were little changed from Thursday, keeping the yield on the 10year benchmark Treasury note at 2.18%.
The S&P 500 wound up the week 1.1% higher than the previous Friday, but stocks are still on course for their worst monthly performance in more than three years. The S&P 500 is down 5.5% in August and the Dow is down 5.9%.
Markets have been volatile since China decided to weaken its currency this month. Investors interpreted that move as an attempt to bolster a sagging economy.
Traders are also jittery about the outlook for interest rates. The Federal Reserve has signaled that it could raise its key interest rate for the first time in nearly a decade later this year.
The recent market turmoil has thrown expectations for a rate increase next month into doubt, with most economists saying it’s off the table for now.
Fed Vice Chairman Stanley Fischer said Friday that before the recent turbulence in financial markets, there was a “pretty strong case” for starting to raise rates in September. But he added that the Fed is watching how events unfold.
The stock market got a boost Friday as the price of oil continued to rebound from its lowest level in more than six years. Oil gained 6.2% on reports of escalating tensions in Yemen. Low oil prices had raised worries about their impact on the energy sector and the health of the global economy.
Freeport-McMoRan rose 31 cents, or 3%, to $10.50 on news that activist investor Carl Icahn took an 8.5% stake in the mining company. The stock surged Thursday when Freeport unveiled cost cuts because of falling copper prices.
Big Lots surged 15.7% after the discount retailer reported better-than-expected second-quarter earnings. The stock rose $6.58 to $48.58.