Stocks Make Minor Gains
Stocks gained ground Friday amidst mixed economic outlooks that sent many to rework their investment strategies from the sidelines.
The Dow Jones industrial average gained 3.71 points, or 0.04%, to 10,324.74. The S&P 500 index climbed 1.56, or 0.14%, to 1,104.49. The Nasdaq composite jumped 4.04 points, or 0.18%, to 2,238.26.
Over the Counter securities market trades totaled $55,627,860. One stock gained for every 1.1 stock that declined. 1,152 stocks remained unchanged.
The Dow started in the red after the largely government owned insurer American International Group (NYSE: AIG) reported an $8.87 billion lose in the fourth quarter. The negative report translates to a loss of $65.51 a share. AIG reported the largest quarterly loss in history one year earlier, totaling $61.7 billion, or $458.99 a share.
The net loss includes $6.2 billion related to paying back the Federal Reserve Bank of New York, $2.8 billion on the pending sale of Nan Shan Life Insurance Co., $2.3 billion in increased commercial insurance reserves, and a $2.7 billion valuation allowance charge for tax benefits not presently recognizable.
AIG said the moves stabilized its insurance businesses and will help it pay back its debt to the U.S. government.
Slumping sales of existing homes may delay economic recovery efforts in the U.S. The National Association of Realtors said sales fell 7.2%to a seasonally adjusted annual rate of 5.05 million from a downwardly revised pace of 5.44 million in December.
The steepest falls were recorded in the Northeast, nearing 11%. Sales fell by about 7% in the South and Midwest and by more than 5% in the West. The median sales price was $164,700.
The Federal Reserve’s $1.25 trillion program to push down mortgage rates is scheduled to expire on March 31.
The only upbeat report on the economy came from the Commerce Department. The government agency said the nation’s gross domestic product grew at an annual rate of 5.9%, rather than the 5.7% pace it estimated last month.
The report is a sign that the U.S. economy has pulled out of the deepest downturn since the Great Depression. It also shows the best improvements in the U.S economy in more than six years.
The Dow’s components were evenly mixed throughout the day. JP Morgan & Chase (NYSE: JPM) was the biggest winner of the day, gaining more than three-and-a-half percent. Bank of America (NYSE: BAC), General Electric (NYSE: GE) and Merck (NYSE: MRK) also say gains exceeding one percent.
Kraft Foods (NYSE: KFT) saw the steepest declines, losing close to one and-a-half percent.
Commodities & Currency
Oil neared $80 a barrel, gaining 1.58, to close at 79.75 a barrel for April delivery. The price of heating oil, natural gas, and unleaded gas also edged higher. Gold climbed 10 points to 1,118.50 an ounce.
The dollar fell against the euro and yen while making minor gains against the British pound.