Stocks Extend Upward Move, S&P 500 Sets New Record High - U.S. Commentary

(RTTNews) - Following the rally seen over the course of the previous session, stocks saw some further upside during trading on Friday. The gains on the day lifted the tech-heavy Nasdaq to its highest levels since early 2000, while the S&P 500 set a new record high.

The major averages all closed in positive territory, although the Nasdaq outperformed its counterparts. While the Nasdaq advanced 36.22 points or 0.8 percent at 4,893.84, the Dow rose 46.97 points or 0.3 percent to 18,019.35 and the S&P 500 climbed 8.51 points or 0.4 percent to 2,096.99.

For the week, the Nasdaq soared by 3.1 percent, while the S&P 500 surged up by 2 percent and the Dow jumped by 1.1 percent.

The strength on Wall Street was partly due to a continued increase by the price of crude oil, which saw further upside after jumping sharply on Thursday.

Crude oil for March delivery surged up $1.57 to $52.78 a barrel after soaring $2.37 to $51.21 a barrel in the previous session.

The continued increase by the price of crude partly reflected news of the ceasefire agreement due to go into effect in eastern Ukraine on Sunday.

Traders also reacted positively to European news, including upbeat GDP data and optimistic signs regarding Greek debt negotiations.

According to Reuters, Greece and its international creditors held talks on Friday on reforms needed to keep the country financed.

The talks are said to increase the possibility of reaching an interim compromise deal at another eurozone finance ministers meeting on Monday.

However, the buying interest was partly offset by the release of a report from the University of Michigan showing a sharp pullback in U.S. consumer sentiment in the month of February.

The University of Michigan said its preliminary consumer sentiment index for February tumbled to 93.6 from the final January reading of 98.1.

The steep drop came as a surprise to economists, who had expected the consumer sentiment index to edge up to a reading of 98.5.

Richard Curtin, the survey's chief economist, said the drop in consumer sentiment was larger among residents of the Northeast and Midwest, who had to cope with unusually harsh winter storms.

Sector News

Reflecting the continued increase by the price of crude, oil service stocks showed a substantial move to the upside on the day. The Philadelphia Oil Service Index surged up by 2.9 percent after closing lower for three straight days.

Helmerich & Payne (HP), Tidewater (TDW), and Weatherford (WFT) turned in some of the oil service sector's best performances.

Other energy stocks also moved notably higher, driving the NYSE Arca Natural Gas Index and the NYSE Arca Oil & Gas Index up by 1.8 percent and 1.9 percent, respectively.

Significant strength was also visible among steel stocks, as reflected by the 3 percent gain posted by the NYSE Arca Steel Index. With the gain, the index reached its best closing level in well over a month.

Electronic storage, internet, software, and trucking stocks are also saw considerable strength, while utilities and tobacco stocks moved to the downside.

Other Markets

In overseas trading, stocks markets across the Asia-Pacific region moved mostly higher on Friday. Hong Kong's Hang Seng Index jumped by 1.1 percent, while Australia's All Ordinaries Index surged up by 2.2 percent. However, Japan's Nikkei 225 Index bucked the uptrend and dipped by 0.4 percent.

The major European markets also moved to the upside on the day. While the German DAX Index rose by 0.4 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both advanced by 0.7 percent.

In the bond market, treasuries moved moderately lower after closing nearly flat for two straight days. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 3.5 basis points to 2.021 percent.

Looking Ahead

Following the Presidents Day holiday on Monday, next week's trading is likely to be driven by reaction to news regarding the Greek debt negotiations as well as some key U.S. economic data.

Traders are likely to keep an eye on reports on producer prices, housing starts, industrial production and regional manufacturing activity.

The release of the minutes of the latest Federal Reserve meeting may also attract attention, as traders look for hints about the outlook for interest rates.

On the earnings front, retail giant Wal-Mart (WMT) is among the companies due to release their quarterly results next week.