NEW YORK - Wall Street closed an erratic week with strong gains Friday as earnings from Microsoft Corp. and an optimistic outlook from Countrywide Financial Corp. outweighed investor concerns about the economy.
Housing market news over the week was glum; oil prices surged to record highs. And though corporate earnings have so far been mixed, investors have been heartened by good news for individual companies.
Friday's report from Countrywide that it expects to return to profitability soon, despite a big third-quarter loss, gave investors hope that the problems in the housing market are containedand that U.S. consumers still have spending power. Thursday night's strong report from Microsoft inspired buying throughout the technology sector.
"The market is higher for just two reasons - Countrywide and Microsoft," said Peter Boockvar, equity strategist at Miller Tabak. "You take those two stocks out of the equation, and there is no reason for the market to be higher. Microsoft single-handedly is driving the Nasdaq."
The Dow Jones industrial average rose 134.78, or 0.99 percent, to 13,806.70.
Broader stock indicators also gained. The Standard & Poor's 500 index rose 20.88, or 1.38 percent, to 1,535.28, and the technology-dominated Nasdaq composite index advanced 53.33, or 1.94percent, to 2,804.19.
For the week, the Dow rose 2.11 percent, the Nasdaq was up 2.9 percent, and the S&P 500 jumped 2.31 percent.
High oil prices didn't dampen investors' spirits either. After spiking above $92 a barrel in Asian trading overnight, December crude futures settled up $1.40 at $91.86 a barrel on the New York Mercantile Exchange.
Even as stocks advanced, investors poured money into commodities markets as a hedge against a falling dollar, which hit another record low against the euro. Gold futures rose $16.50 to close at $787.50 an ounce, the highest price since January 1980. Energy, metals and agriculture futures all moved higher.
Treasury bonds turned loweras stocks barreled higher. The yield on the 10-year Treasury note, which moves inversely to the price, rose to 4.39 percent from 4.38 percent late Thursday.
Advancing issues outnumbered decliners by nearly 3 to 1 on the New York Stock Exchange, with 3.51 billion shares traded, down from 4.07 billion on Thursday.
The Russell 2000 Index of smaller companies rose 15.28, or 1.90 percent, to 821.39.
Japan's Nikkei stock average rose 1.36 percent, and Hong Kong's Hang Seng index rose 1.84 percent. In Europe, Britain's FTSE 100 rose 1.29 percent, Germany's DAX index rose 0.21 percent, and France's CAC-40 rose 0.6 percent.
Business, Pages 38 on 10/27/2007