By Matt Jarzemsky
U.S. stocks edged higher, with the S&P 500 looking to close
out its first weekly gain in three weeks, as April new home sales
data topped expectations.
The S&P 500 index added three points, or 0.1%, to 1895 in
early trading. The benchmark U.S. stock index was up 0.9% on the
week and within 0.2% of its May 13 record close.
The Dow Jones Industrial Average tacked on 34 points, or 0.2%,
to 16575. The Nasdaq Composite Index rose four points, or 0.1%, to
4159.
Stocks have wavered near record highs in recent weeks, as
investors weigh sluggish but better-than-expected corporate profit
growth, a still-muted recovery across much of the economy and
sluggish return prospects for other assets such as bonds.
"The stock market just seems to grind higher. It's the only
thing you can own because everyone's bearish on bonds, and cash is
yielding nothing," said Jordan Waxman, managing partner at HSW
Advisors, which oversees $1.3 billion and has stuck with a
relatively bullish position on stocks this year.
The yield on the 10-year Treasury note inched lower to 2.530%
from 2.555% late Thursday.
While investors remain skittish about the economic outlook,
there appear to be ready buyers at any sign of a pullback in
stocks, lending buoyancy to the market, he added.
Traders expect volume to remain especially low ahead of the long
Memorial Day weekend, closing out a week of muted activity. This
week has already seen the third-, fourth- and fifth-lowest volume
days of the year for New York Stock Exchange-listed issues.
Sales of newly built homes in the U.S. rose to 433,000 in April,
the Commerce Department reported, topping the 420,000 median
estimate of economists in a Wall Street Journal poll. March's rate
was revised higher.
Crude oil futures ticked up 0.2% to $103.96 a barrel, while gold
futures eased 0.1% to $1,293.30 an ounce. The dollar gained some
ground against the euro and the yen.
European markets edged lower following downbeat German business
confidence data. Investors also treading cautiously ahead of this
weekend's European Parliament elections.
The Stoxx Europe 600 was down less than 0.1%, but remained on
track for a sixth-straight weekly gain, the longest such streak
this year.
The Ifo Institute's German business confidence index fell to
110.4 in May from 111.2 in April, below expectations of 111. The
indexes for current conditions and expectations also fell more than
forecast.
Asian markets were mostly higher. Japan's Nikkei Stock Average
rose 0.9% to a three-week high, and China's Shanghai Composite
gained 0.7%.
In corporate news, Aéropostale tumbled 19% after the teen
apparel retailer reported late Thursday a narrower-than-expected
fiscal first-quarter loss, but revenue that missed forecasts, a
sharp drop in same-store sales, and a downbeat outlook for the
current quarter. Through Thursday, the stock had already lost 50%
this year.
Hewlett-Packard added 4.5 % after reporting quarterly earnings
in line with analysts' forecasts and saying it plans to increase
the number of eliminated positions by between 11,000 and 16,000 as
part of a restructuring program adopted in 2012.
H-P's shares had initially fallen Thursday afternoon, when its
results were accidentally posted on its website ahead of their
scheduled release after the day's close.
GameStop climbed 4.9% after reporting better-than-expected
fiscal first-quarter earnings and affirming its full-year outlook,
as continued strong demand for gaming consoles helped drive sales
growth.
Gap eased 1.3% after the apparel retailer reported late-Thursday
fiscal first-quarter earnings that eked past expectations and
affirmed its full-year outlook.
Shale oil driller Parsley Energy jumped 17% in its trading
debut. Late Thursday, the Midland, Tex.-based company and some
early equity holders sold more shares than expected for a greater
price than forecast in an initial public offering.
Write to Matt Jarzemsky at matt.jarzemsky@wsj.com