Dow Posts Weekly Loss; S&P, Nasdaq Extend Streak

U.S. stocks ended higher on Friday following strong trade data, though the Dow Jones Industrial Average posted a weekly decline and snapped a five-week winning streak.

The Dow industrials  climbed 48.92 points, or 0.4%, to 13,992.97, after touching an intraday high of 14,022.62. The blue-chip index tuned in its first weekly loss in six, declining 0.1% on the week.

Twenty-one out of 30 components of the Dow traded higher; Hewlett-Packard Co.  led the way with a 2.6% gain. Boeing Co.  weighed on the index with a 1.1% loss Friday.

Following the tech bubble of the late 1990s and the 2008 financial-crisis rout, investors are less likely to trust bull runs, said Janet Briaud, president of Briaud Financial Services, who noted the current level of bullishness in stocks was similar to that of late 2007.

“[The Dow] hits 14,000 and then goes back; it’s a big barrier from a technical standpoint. That level of bullishness is something to pay attention to,” Briaud said.

Both the S&P 500 and Nasdaq logged their sixth week of gains.

The S&P 500 index  gained 8.54 points, or 0.6%, to 1,517.93, with tech and consumer discretionary stocks leading its 10 major sectors higher. The S&P 500 rose 0.3% for the week.

Shares of Microchip Technology Inc.  led the S&P 500, closing up more than 7% after the chip maker gave a favorable outlook for the first quarter.

Stocks on the tech-heavy Nasdaq Composite index  closed near their intraday highs, advancing 28.74 points, or 0.9%, to 3,193.87. The Nasdaq finished up 0.5% on the week. Shares of Apple Inc.  rose 1.4% Friday to close at $474.98.

Stocks received some support from economic data. Reports, such as the U.S. trade deficit and China trade numbers, are still supportive of continued slow economic growth, said Paul Nolte, managing director at Dearborn Partners in Chicago.

The U.S. trade deficit fell almost 21% in December to $38.5 billion, marking the biggest drop in four years, as exports rose and imports softened. In China, exports and imports accelerated at a faster-than-expected rate in January, according to official data.

That better-than-expected trade data may lead to revisions of fourth-quarter gross-domestic-product figures into positive territory, said Scott Armiger, manager of the $500 million Christiana Trust at Wilmington Savings Fund Society.

“That will make people have a little more confidence in GDP, and will probably revise the fourth-quarter number up a little bit,” said Armiger.

In late January, the Commerce Department reported that fourth-quarter GDP contracted by 0.1% in the first of three readings.

Following a rise of 12% since mid-November, with about 6% of that in January alone, the new line for the S&P 500 appears to be 1,500, Dearborn’s Nolte said.

“Markets are going sideways to work off that bullish run, and from a bullish perspective that’s a good thing,” said Nolte. Stocks have had a seesaw week in general as investors deal with a stock market considered by many as overbought and anticipate a big correction around the corner. Read: Is this market headed for a correction?

Blizzard Nemo cools off trading volume

Meanwhile, the Northeast, including New York City, was bracing for a major blizzard, which is expected to reach maximum intensity on Saturday morning. Thousands of flights have been grounded. See: Snow falling in New York as Northeast blizzard takes hold

Trading volume was thinner than average. Composite volume on the NYSE topped 2.7 billion shares; the daily average has been around 3.6 billion. About 1.7 billion shares changed hands on the Nasdaq Stock Market, compared with the average 2 billion.

Advancing stocks outnumbered decliners by about 2 to 1 on the NYSE, and just under 2 to 1 on the Nasdaq.

In corporate news, McDonald’s Corp.  said its global comparable sales in January fell 1.9%. Shares closed up 0.3%.

Shares of LinkedIn Corp.  finished up 21% after the professional social network reported better-than-expected fourth-quarter earnings and revenue. See: Analysts say LinkedIn not overvalued …yet.

Moody’s Corp.  shares fell nearly 8%. The ratings agency reported a 66% surge in fourth-quarter earnings, but they came in slightly lower than expected. Also, New York Attorney General Eric Schneiderman is looking at any potential misconduct by the three major credit-ratings firms, including Moody’s, a person familiar with the matter told MarketWatch.

Marketwatch