NEW YORK: Stock indexes closed nearly unchanged Friday to end their worst week in four months, with the market stalling as worries about Europe overcame an unexpected rise in U.S. consumer confidence.
“We’re all waiting on Spain now,” said Bill Stone, chief investment strategist at PNC Asset Management Group, of persistent speculation over if and when the debt-strapped nation would ask for a financial bailout — a prerequisite for the European Central Bank to purchase its debt and help lower its borrowing costs.
Stocks had gained after a gauge of consumer confidence unexpectedly jumped in October and after JPMorgan Chase & Co. earnings cast a positive light on the housing market.
“We got a little help from earnings season so far,” Stone said.
But Wall Street gains were limited, with October so far proving to be a lackluster month for U.S. equities, after a steady climb that had the S&P 500 index advancing 2 percent and more in both August and September.
“After the real move we had, it is reasonable to expect a little breather, and the baton is being passed from monetary-policy makers like the ECB and the Fed to the real economy on the fiscal side. In the U.S., there’s the fiscal cliff and election to deal with, and on the European side, they still have to figure out their fiscal issues,” Stone said.
The Dow Jones industrial average ended with a 2.46-point gain at 13,328.85, leaving it off 2.1 percent from the week-ago close.
Down 2.2 percent for the week, the S&P 500 fell 4.25 points, or 0.3 percent, at 1,428.59. The Nasdaq composite index lost 5.3 points, or 0.2 percent, at 3,044.11.
The euro trimmed its rise against other currencies, including the U.S. dollar, after a report by the International Financing Review that the European Stability Mechanism did not have enough cash to rescue Spain if the nation asked for a bailout before the end of the year. But officials stressed in interviews with other media outlets that the fund has the means to raise capital by selling fixed-income securities.
The issue reportedly dominated discussions at a gathering of finance ministers at the International Monetary Fund and World Bank twice-yearly meetings in Tokyo. Spain’s economic minister didn’t say if and when Spain would ask for help, but said the ECB credit line “is ready to be activated,” Reuters reported.
Stocks began Friday’s session mildly higher and had added to those gains after the University of Michigan-Thomson Reuters consumer-sentiment index rose to 83.1 in an initial October reading from 78.3 in September.
“In theory, anyway, confidence begets spending,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott.
JPMorgan’s profit exceeded estimates on higher mortgage revenue.
“The housing recovery is intact; Jamie Dimon said as much,” Luschini said of the bank’s chief executive.
Shares of Wells Fargo & Co. slid 2.6 percent after the bank reported revenue below expectations.
Advanced Micro Devices Inc. shed 14 percent after the computer-processor maker reduced its third-quarter revenue outlook.