Stocks ended higher Friday after better-than-expected results from Ford but ended lower for the week, snapping a six-week winning streak.
The Dow Jones Industrial Average gained 119.23, or 1.5 percent, to close at 8,076.29. The S&P 500 advanced 1.7 percent, while the Nasdaq soared 2.6 percent.
For the week, the Dow and S&P finished lower after six straight up weeks. The Nasdaq eked out a seventh straight weekly gain, fueled by Sun , which jumped 38 percent following news of its merger with Oracle.
Stocks shrugged off a dismal durable-goods report and worries about the bank stress tests, and were encouraged by Ford's narrower-than-expected loss.
Stocks dipped briefly after the Fed said most banks are well capitalizedbut will need a "substantial" amount more to brace in case the recession gets worse.
"The concern is that as more information comes to the markets, banks having to raise capital will face more pressure,'' said Blake Howells an analyst at Becker Capital Management in Portland, Oregon. "No one knows how much downside there could be in their stocks, how much capital will be raised and what form that capital will take. Those are the unknowns.''
Still, most banks finished higher, including Bank of America and JPMorgan . But Citigroup fell.
Ford shares soared 11 percent after the automaker reported a net loss of 60 cents a share, compared with 3 cents per share in the same quarter of 2008. Excluding items, it lost 75 cents a share, beating expectations, which had called for a loss of $1.23 a share. The company also said it expects to be profitable by 2011.
American Express also topped forecasts, helped by cost cuts. But Moody's cut its credit rating on AmEx, citing weaker assets. Still, AmEx was the top percentage gainer on the Dow, climbing 21 percent.
Microsoft was the second-biggest percentage gainer on the Dow, climbing 11 percent, after the software giant hit analysts' earnings target as cost cuts offset a slump in PC demand.
3M rounded out the Dow's top three, gaining 5.2 percent, after the post-it note and Scotch-tape maker missed analysts' target with earnings of 81 cents a share and cut its 2009 forecast but S&P raised its price target to $61 and kept its "buy" rating on the stock.
Amazon helped buoy the Nasdaq, rising 4.8 percent, after the Internet retailer beat earnings expectations.
Honeywell matched forecasts with a profit of 54 cents a share, but cut its full-year earnings guidance, citing the slumping economy.
On the economic front, U.S. Treasury Secretary Timothy Geithner said that the downturn has started to show signs of improving in recent weeks, when speaking at a meeting of G20 officials in Washington.
And March durable-goods orders fell 0.8 percent, half of the drop expected, though February was revised sharply lower to show a 2.1-percent gain. That number was previously reported as a 3.5-percent increase. Excluding the volatile transportation component, orders fell 0.6 percent, after a 2-percent increase last month.
New-home sales dropped 0.6 percent in March after an upwardly revised 8.2-percent jump in February. Inventories of new homes dropped to 311,000 from 328,000, the biggest decline in more than 45 years.
Not only was AmEx the winner today, but it led the Dow for the week, up 16 percent since last Friday. This is the third straight week the credit-card provider has been the workhorse of the Dow.
On the flip side, Wal-Mart had the most negative impact on the Dow, down 5 percent this week.
Over on the Nasdaq, Microsoft led the pack, up 9 percent this week.
Ten key S&P sectors were split: Five finished higher, led by materials, which gained 2 percent this week. Health-care came in last, falling 4 percent.
Volatility had begun to slide, and in fact the CBOE volatility index had finished down about 1 percent today, but for the week, it was up almost 9 percent as investors worried about earnings and bank stress tests.
Next week brings another full roster of earnings reports, including reports from Verizon , Pfizer , Sun, Time Warner , ExxonMobil , Motorola and MasterCard .
MONDAY: Manufacturing reports from Dallas, Chicago Fed branches; Earnings from Verizon
TUESDAY: Two-day Fed meeting begins; Case-Shiller home-price index; Richmond Fed survey; Conference Board consumer confidence; Earnings from Pfizer, Bristol-Myers, US Steel and Sun Micro
WEDNESDAY: Weekly mortgage applications; advance Q1 GDP; weekly crude inventories; Fed rate decision; Earnings from Wyeth, Aetna, General Dynamics, Time Warner, Starbucks and Visa
THURSDAY: Weekly jobless claims; personal income/spending; Kansas City Fed report; Fed's Volcker speaks; Earnings from ExxonMobil, AstraZeneca, Cardinal Health, Colgate-Palmolive, Comcast, Ericsson, Kellogg, Motorola, Viacom and MetLife
FRIDAY: Auto sales; Fed's Geithner, Bullard speak; Reuters/Univ of Mich consumer confidence; ISM manufacturing index; factory orders; Earnings from Chevron, Clorox, MasterCard and Simon Property
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