U.S. stocks rose modestly midday Friday, as the market failed to get much juice out of an unexpectedly strong third quarter GDP number.
The Nasdaq tacked on 0.2%, while the S&P 500 added 0.3%. The blue chip Dow Jones industrial average advanced 0.4%. Volume in the stock market today was running about 15% below the previous session's pace.
Q3 GDP surged 2.9%, its best growth in two years and above estimates for 2.5%. The problem is that GDP estimates can be notoriously unreliable. The last time the first reading on GDP exceeded 2% was the second quarter of last year. But look what happened afterward: The first reading was 2.3%; the second take, 3.7%; the third estimate, 3.9%; and an additional revision in July 2016, 2.6%. A clumsy toddler with a handful of darts might do as well.
Big cap stocks were doing well Friday. In the IBD Big Cap 20, a list of the best big caps by fundamentals and technicals, winners led losers by a 4-1 ratio. Winners included: internet content leader Alphabet (GOOGL), up 2% in volume 450% above average; surgical equipment provider Stryker (SYK), up 3.5% in volume 350% greater than usual; and online travel booker Priceline (PCLN), up 1% in volume more than twice its routine pace.
Amazon.com (AMZN) led the Big Cap 20 losers with a 4% gap down in volume more than 500% above average. The company reported quarterly results after Thursday's closing bell, missing badly on earnings but a little better than in line with the consensus estimate on revenue.
Among smaller stocks, telecom play Lumentum (LITE) swung wildly. The stock dropped about 11% five minutes into Friday's session but then reversed to as much as a 6% gain. In midday action, the stock was up 3% and back above its 50-day line. On Thursday, the company reported quarterly results that topped estimates on the top and bottom line but offered a weaker-than-expected outlook.
Blue chips were mostly up. In the 30-stock Dow, three stocks advanced for every one that fell. The biggest percentage gainer was Chevron (CVX), up almost 4% in three times its normal volume. Chevron reported quarterly results that trounced earnings estimates and were roughly in line on revenue.
