S&P records seven weeks of gains
- Banks weigh on European shares
- Gold demand wanes ahead of G20
- Oil hit by US economic worries
- AUD steady at $US1.0357
- SPI futures up 5 points to 5000
The S&P 500 dipped in a late decline on Friday as Wal-Mart dropped following a report of a weak start to February sales, though the index just barely extended its streak of weekly gains to seven.
Equities were little changed for much of the session, with investors finding few reasons to make big bets following an extended rally on Wall Street, but stocks turned lower in afternoon action.
Wal-Mart Stores Inc dropped 2.1 per cent to $US69.30 after Bloomberg News reported a weak start to February sales, citing internal company e-mails. The stock was the biggest decliner on the Dow, while the S&P retail index fell 0.5 per cent.
"When a retailer of this size comes out with this kind of lousy news, the whole market can fall off, especially on a Friday afternoon," said Mike Shea, trader at Direct Access Partners in New York. "However, I'm not worried that this is indicative of any larger macro issue with retail."
Equities have struggled for direction recently, with major indexes moving only slightly in the past several sessions. The S&P didn't end a session with a move greater than 0.2 per cent at all this week.
The benchmark index, up 6.6 per cent so far this year, is facing strong technical resistance near the 1,525 level. But investors, expecting the index to advance further in the quarter, have held back from locking in profits.
"There's no news that suggests the strong underpinning for stocks isn't appropriate. We may have gotten ahead of ourselves, but there's also an absence of bad news," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
Many investors are starting to look ahead to a debate in Washington over sequestration, automatic across-the-board spending cuts put in place as part of a larger congressional budget fight. The cuts are due to kick in March 1 unless lawmakers agree to an alternative.
"This had been far enough out to not yet become an impediment for stocks, but it will start to move into the forefront and cause people to take a bit of a jaundiced eye towards the market," said Luschini, who helps oversee about $US54 billion in assets.
The Dow Jones industrial average was up 11.27 points, or 0.08 per cent, at 13,984.66. The Standard & Poor's 500 Index was up 0.32 points, or 0.02 per cent, at 1,521.70. The Nasdaq Composite Index was up 1.51 points, or 0.05 per cent, at 3,200.17.
For the week, both the Dow and Nasdaq fell 0.1 per cent while the S&P rose 0.1 per cent in its seventh straight week of gains, a period during which the index rose 8.4 per cent. The last such seven-week run was between December 2010 and January 2011.
The New York Federal Reserve said manufacturing in New York state expanded for the first time in seven months, while Thomson Reuters/University of Michigan's preliminary reading of consumer sentiment rose from the prior month and beat expectations.
But US manufacturing fell in January after a rise in the prior month.
Wall Street's gain thus far in 2013 has largely been driven by strong corporate earnings, while data indicated some weakening in economic conditions.
A surge in merger and acquisition activity, with more than $US158 billion in deals announced so far in 2013, has given further support to the equity market as it points to healthy valuations and bets on the economic outlook.
Herbalife shares cut earlier gains to rise 1.2 per cent to $US38.74. Late Thursday, billionaire investor Carl Icahn said in a regulatory filing that he now owns 13 per cent of Herbalife and was ready to put it in play.
MeadWestvaco Corp climbed 12.5 per cent to $US35.65 as the biggest per centage gainer on the S&P index after activist investor Nelson Peltz's Trian Fund Management LP said it had bought about 1.6 million shares of the packaging company.
Burger King Worldwide shares gained 4.7 per cent to $US17.36 after it beat estimates with a 94 per cent rise in fourth-quarter profit, thanks to new menu additions.
Oil service stocks declined, weighed by a 5.1 per cent drop in shares of Transocean to $US56.26, after the rig contractor reported its fleet update and Deutsche Bank cut its rating on the stock to "sell." The PHLX oil service sector lost 1.5 per cent.
Slightly more stocks fell than rose on the New York Stock Exchange while about 50 per cent of Nasdaq shares ended lower. About 6.69 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, above the daily average so far this year of about 6.48 billion shares.