Stocks end mixed: Nasdaq deeper in red for 2015
Stocks ended the week on a mixed note despite a big early rally Friday off Federal Reserve Chair Janet Yellen's comments about a potential rate hike.
The Dow Jones industrial average finished up about 113 points, or 0.7%, at 16,315, but that was half of its earlier gain. The Standard & Poor's 500 index barely moved, down less than 0.1%. The Nasdaq composite index got pounded, losing 1% following another big selloff in biotech stocks.
Yellen gave stocks a broad boost early Friday after she suggested in a speech late Thursday that global economic weakness won't be significant enough to alter the central bank's plan to raise its key short-term rate from near zero by December. Uncertainty over the Fed's timetable for raising rates has been weighing on the market as investors seek clarity on monetary policy was offset later in the day by plunging biotech stocks, which dragged the Nasdaq into negative territory for the day — and further into the red for 2015.
The Nasdaq, which on Thursday joined the other two benchmarks in negative territory for 2015, is now about 50 points below its 2014 close of 4736.05.
In economic news, the latest revision of second-quarter gross domestic product showed that the economy grew at a faster pace than previously estimated. The economy grew at an annual rate of 3.9% in the April-June quarter, up from a previous estimate of 3.7%, the Commerce Department said.
Economy grew at 3.9% rate in April-June quarter
"A gradually increasing rate environment is a positive, because it sends a signal … that the U.S. is on a good, if not great, recovery to growth," said Scott Keifer, global investment specialist at JPMorgan private bank. He expects economic growth to average about 2.5% next year, allowing the Fed to raise interest rates gradually.
Blue-chip icon Nike (NKE) alone boosted the Dow about 70 points as the athletic gear maker reported earnings that beat analysts' expectations. Nike ended up 8.9% to $125 even a share.
European markets rebounded Friday as scandal-plagued Volkswagen named Porsche CEO Matthias Mueller as its new CEO.
Porsche boss Matthias Mueller named Volkswagen CEO amid emissions scandal
France's CAC 40 surged 3.1% and Britain's FTSE 100 index rose 2.5%. Germany's DAX index rose 2.8%, helped by a 4% rise in shares in BMW. The company saw a big drop Thursday on a report that one of its models exceeded European emissions limits. The report did not allege any cheating by BMW.
In Asia, Japan's Nikkei 225 index gained 1.8% to close at 17,880.51 while Hong Kong's Hang Seng index rose 0.4%. The Shanghai composite index lost 1.6%, closing at 3092.35.
Stocks climbed out of a deep dive Thursday, but still closed lower as the Nasdaq slid into negative territory for the calendar year and stocks posted their third straight down day.
Contributing: Associated Press