Smallcompany stocks shine on hohum day

NEW YORK» U.S. stocks hardly moved Friday as the market wrapped up a solid week. Smaller companies rose after signs of sustained economic growth and reports that more tariffs on Chinese goods could be on the way.

Stocks rose in early trading after the Federal Reserve announced that production of cars and energy jumped in August. The Commerce Department said sales by retailers grew only slightly in August after a big gain in July.

“It’s a reflection of stronger economic growth,” said Kate Warne, an investment strategist for Edward Jones. “It continues to bode well for strength going into the fall and later in the year.

Warne said she expects the U.S. economy to grow about 3 percent this year, which is what most experts are forecasting. She said growth will be a bit weaker than in 2019, but that would still be better than most of the previous years since 2009.

Bond yields jumped Friday as investors interpreted the Federal Reserve report as a sign that the economy will keep growing and interest rates will keep rising. That helped bank stocks, but it hurt highdividend stocks.

Retailers and health care stocks also took small losses.

The S&P 500 index rose 0.80 points to 2,904.98. The index rose all five days this week after a fourday losing streak last week.

The Dow Jones Industrial Average added 8.68 points to 26,154.67. The Nasdaq composite slipped 3.67 points to 8,010.04.

The combination of trade worries and positive economic news helped smaller companies, which do more business in the U.S. than larger companies do. That makes them less vulnerable to flareups in trade tensions. The Russell 2000 index gained 7.40 points, or 0.4 percent, to 1,721.72.

Bloomberg News reported that President Donald Trump has told aides to go ahead with tariffs on $200 billion in imports from China. The report said the administration may be having difficulty finding products it can tax that won’t result in major complaints from consumers and businesses.

China said Thursday the U.S. had reached out to open a new round of trade talks. The new round of tariffs would represent a major escalation in the U.S.China trade conflict, which has lasted for most of this year.

Industrial companies also rose after the Federal Reserve’s report. Aerospace company Boeing jumped 1.2 percent to $359.80 and shipbuilder Huntington Ingalls gained 1.6 percent to $252.90.

The industrial data is a sign that the U.S. economy is likely to keep growing, which means the Federal Reserve is likely to continue raising interest rates. It is expected to raise interest rates this month, the third increase this year out of an expected four.