Market report

Stocks drift, then score tiny gains

NEW YORK -- Summer settled into Wall Street on Friday as major stock indexes drifted slightly higher going into the weekend. The listless day of trading left the stock market with a tiny loss for the week, its second this month.

The Standard & Poor's 500 index edged up 3.74 points, or 0.2 percent, to close at 1,960.96. The most widely used benchmark for stock funds lost 1.91 points for the week, a loss of 0.1 percent.

The Dow Jones industrial average rose 5.71 points, less than 0.1 percent, to close at 16,851.84, while the Nasdaq composite rose 18.88 points, or 0.4 percent, to 4,397.93.

Stocks reversed losses in the final hour of trading amid Russell Investments' annual revisions to its benchmark indexes.

"Due to the sharp increase in market share of exchange-traded funds and large number of active managers that are closet indexers, it will most likely have an impact as the herd panics to get into new index names," Eric Cinnamond, Louisville, Ky.-based manager of the $798 million Aston/River Road Independent Value Fund, said in an email.

Russell's U.S. stock indexes, including the Russell 1000 Index and the Russell 2000 Index, are used as benchmarks for $5.2 trillion in assets, according to the company's website.

In the previous two years, the reconstitution day ranked in the top two busiest trading sessions, data compiled by Bloomberg show. Trading in S&P 500 companies was 20 percent below the 30-day average.

A handful of corporate results drove trading in some big names. Warnings of weaker earnings pushed DuPont down, while stronger results pushed Nike up. But the overall market was essentially flat.

"The fact is, it's the summer, and there isn't much happening," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.

That could change quickly. Turmoil in the Middle East could easily rattle U.S. markets, especially if the fighting in Iraq drives oil prices too high, Ablin said. Rising tensions between Ukraine and Russia also remain a concern.

"The risk in the summer typically isn't financial, it's political," he said. "This summer, it's geopolitical: Iraq and Ukraine."

Many investors have been waiting for the market to take a break from its long climb. The S&P 500 has gained 5.8 percent in three months and reached its latest all-time high on June 20.

DuPont dropped $2.26, or 3 percent, to $65.44. The company cut its profit forecast late Thursday as a result of weaker sales of corn seeds.

Nike gained 82 cents, or 1 percent, to $77.68 after reporting earnings late Thursday that beat Wall Street's expectations. Stronger worldwide sales offset marketing costs for the World Cup soccer tournament. Nike provided the uniforms for 10 teams, including the U.S. national team, for the World Cup in Brazil.

Bond prices were little changed. The yield on the 10-year Treasury note held steady at 2.53 percent. The price of oil fell 10 cents to settle at $105.74 a barrel.

Information for this article was contributed by Oliver Renick of Bloomberg News.

Business on 06/28/2014

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