US Markets

Stocks rise slightly to end a record-setting week

Markets can 'truly go higher' despite volatility, says investor
Markets can 'truly go higher' despite volatility, says investor

Stocks rose slightly on Friday as Wall Street wrapped up a solid weekly performance that featured record levels amid strong global economic data and a solid start to the earnings season.

The Dow Jones Industrial Average closed 50.46 points higher, or 0.2% at 29,348.10. The S&P 500 climbed 0.4% to 3,329.62 while the Nasdaq Composite advanced 0.3% to end at 9,388.94. The major averages all hit record highs on Friday. 

Friday's gains came after Chinese industrial data for December topped expectations overnight, with production rising 6.9% on a year-over-year basis. The overall Chinese economy grew by 6.1% in 2019, matching expectations. To be sure, that is also the slowest growth rate for the Chinese economy since 1990.

In the U.S., housing starts soared nearly 17% in December and reached a 13-year high. That data follows Thursday's release of better-than-forecast weekly jobless claims and strong business activity numbers from the Philadelphia Federal Reserve.

For the week, the S&P 500 climbed nearly 2% while the Dow advanced 1.8%. The Nasdaq finished the week up 2.3%. Those gains built on the massive stock surge from 2019 and added to this year's strong start. The S&P 500 and Dow are up 3.1% and 2.8%, respectively, year to date. The Nasdaq has bolted more than 4.5% higher in 2020.

The S&P 500 notched its best one-week performance since the final week of August along with the Dow and Nasdaq.

"Risk assets are off to a good start in 2020," said Gregory Faranello, head of rates at AmeriVet Securities, in a note. "Returns last year were off the charts. But when you factor in the late 2018 market corrections across both equities and credit, things look less stellar."

Trader Peter Tuchman and specialist trader Michael Pistillo wear DOW 29,000 hats on the floor at the New York Stock Exchange (NYSE) in New York, January 15, 2020.
Brendan McDermid | Reuters

These gains to start off the year, however, are keeping hedge fund billionaires David Tepper and Stanley Druckenmiller confident in the current bull run. 

Tepper told CNBC's Joe Kernen in an email: "I love riding a horse that's running." Tepper, meanwhile, told Kernen in a separate email he is still bullish in the "intermediate term" in part because of the Federal Reserve's current monetary policy stance.

A solid start to the corporate earnings season also lifted investor sentiment this week. More than 8% of the S&P 500 has reported quarterly results thus far, FactSet data shows. Of those companies, 72% of companies gave posted better-than-expected earnings.

Schlumberger reported Friday quarterly earnings that beat analyst expectations. CSX's earnings also beat expectations, but the stock slid 0.2%. Big banks such as Goldman Sachs, Bank of America and Morgan Stanley all reported quarterly figures that exceeded estimate earlier this week.

"We didn't have much in the way of earnings growth last year," said Chris Marx, senior investment strategist for equities at AllianceBernstein. "But we do expect to see reasonable earnings growth if people's confidence holds up, and that should be constructive for the market."

—CNBC's Silvia Amaro contributed to this report.

Correction: A previous version of this story misattributed Chris Marx's quote.