U.S. stocks turned higher on Friday, cutting weekly losses for the Dow industrials, with Nike helping bolster the blue-chip index after reporting better-than-expected quarterly results.
"The earnings outlook for the second quarter is still decent, and valuations aren't out of line. The only real shocker was GDP, but that was ancient history, and the rest of the data has been either neutral or moderately positive," said Randy Frederick, managing director of active trading and derivatives at Charles Schwab.
"We're clearly in a bull market and will continue to be until at least October, but we're at a point where we need a pullback" of possibly 3 to 5 percent, he added.
Equities shifted into positive terrain in the final 30 minutes of trade after spending most of the session under water.
Two measures used to hedge against a market pullback are at extremes, so "technically we are clearly overdue," said Frederick, who pointed to the put-call ratio on the S&P 500 and the CBOE Volatility Index, or VIX.
DuPont declined after the chemicals supplier for the second quarter and full year; Nike rose after the outfitter of 10 World Cup teams reported quarterly results that beat expectations. Keurig Green Mountain jumped after Argus Research upgraded its shares to buy from hold. Dollar General fell after the discount retailer stuck to its lowered full-year profit outlook given in June and said its CEO would retire at the end of May 2015 or upon a successor's appointment. GoPro jumped in the video-camera makers second day on the public markets.
"The market is attempting to form a trading range during the summer of 2 to 3 percent from the high to low of the range," said Peter Cardillo, chief market economist at Rockwell Global Capital.
Investors were little moved by a report that had consumer sentiment climbing in June, with the Thomson Reuters/University of Michigan's index on consumer sentiment rising to 82.5, up from 81.9 in May.
"Confidence figures are always coincident and do not tell us anything about what consumer behavior may or may not be in coming months and therefore does not move markets in response," Peter Boockvar, chief market analyst at the Lindsey Group emailed.
The confidence report comes a day after weaker-than-expected consumer spending prompted economists to cut their growth forecasts for the second quarter.
After a 71-point fall, the Dow Jones Industrial Average ended with a gain of 5.71 points, or less than 0.1 percent, at 16,851.84, with Microsoft and Nike pacing blue-chip gains and DuPont and Merck & Co. its losses. The Dow was off 0.6 percent from a week ago, and up 0.8 percent for June.
Down 0.1 percent on the week and up 1.9 percent this month, the rose 3.74 points, or 0.2 percent, to 1,960.96, with materials falling the most and technology the best performing of its 10 major industry sectors.
The Nasdaq also turned higher, up 18.88 points, or 0.4 percent, at 4,397.93, up 0.7 percent for the week and 3.7 percent for June, with one session remaining in the month.
The CBOE Volatility Index, a gauge of investor uncertainty, fell 3.2 percent to 11.26.
For every five stock falling, two gained on the New York Stock Exchange, where almost 1.5 billion shares traded. Composite volume neared 4.1 billion.
The dollar edged lower against the currencies of major U.S. trading partners, and the yield on the 10-year Treasury note used in figuring mortgage rates and other consumer loans held steady at 2.533 percent.
Gold futures for August delivery rose $3.00, or 0.2 percent, to $1,320.00 an ounce and crude futures turned lower, down 10 cents, or 0.1 percent, to $105.74 a barrel on the New York Mercantile Exchange.
On Thursday, equities slid after government data prompted downward revisions to U.S. economic growth in the second quarter, and a Federal Reserve official jolted the market by reiterating his contention that interest rates could rise sooner than expected.
The hawkish comments to Fox Business News by James Bullard, president of the Federal Reserve Bank of St. Louis, "were in focus, but basically it's just an excuse" to sell, said Cardillo of the prior day's drop.
Schwab's Frederick largely concurred, saying Bullard is among the more hawkish members of the Federal Open Market Committee, or FOMC.
Plus, Bullard is "not a voting member and he's not in charge, while (Federal Reserve Chair Janet) Yellen is very dovish and she's the one calling the shots," Frederick said.