By Anna Isaac and Dawn Lim
U.S. stocks finished higher in another volatile session Friday, but the S&P 500 logged its fourth consecutive week of declines.
The toll of the coronavirus pandemic, the prospects of an uneven U.S. economic recovery and uncertainty from a presidential race has injected turbulence in markets. The major stock indexes swung between small losses and gains Friday morning before beginning their ascent.
The S&P 500 added about 1.6%. The Dow Jones Industrial Average rose 1.3%. The Nasdaq Composite climbed 2.2%.
"The choppiness is the market trying to figure out where the heck we are, " said Brad McMillan, Commonwealth Financial Network's chief investment officer. "We're going to see more choppiness going forward."
Investors' confidence has been crimped by elevated levels of new coronavirus infections in the U.S. and Europe, as well as signs that the global economic recovery is slow and uneven. The prospect of a contested November presidential election adds to uncertainty.
"We're in a bit of a holding pattern. It feels like a bit of a phony market right now. I don't think there's any key factors that have changed," said David Coombs, head of multiasset investments at Rathbone Brothers. "Until we get a vaccine for the population at large, the coronavirus course is uncertain."
New economic data provided hints of recovery in the manufacturing industry. New orders for durable goods rose 0.4% in August from July, the Commerce Department said Friday. The increase, on the heels of bigger advances earlier in the summer, was weaker than economists predicted. Many investors say the true litmus test of an economic recovery is whether they see stronger signs of a rebound in jobs.
"You've had the dichotomy of some good news and bad news," said Jeffrey Schulze, an investment strategist at ClearBridge Investments. "The market is having a difficult time finding its footing."
The U.S. reported about 44,000 new coronavirus cases Thursday, up from about 37,000 a day earlier and bringing the total number of people who have been infected in the country to about 6.98 million, according to data compiled by Johns Hopkins University. Daily new infections have been going up again since mid-September.
Investors are awaiting signs of progress on additional U.S. stimulus spending from the government. House Democrats are readying a scaled-down package of about $2.4 trillion that would include assistance to airlines, restaurants and small businesses. But Republicans said the chances of a deal before Election Day remained slim.
"We've had such a huge fiscal response already, it's easy to say the response now is disappointing," said Holger Schmieding, chief economist at Berenberg Bank. "It's basically a matter of time: before or after the election. Significant support is coming. The Fed is asking for it."
In bond markets, the yield on the U.S. 10-year Treasury ticked down to 0.661%, from 0.664% Thursday.
In commodities markets, gold fell 0.6% to $1857.70 a troy ounce Friday and suffered the largest weekly percentage decline since March. The precious metal has been hit by a strengthening dollar and falling inflation expectations.
Shares of Novavax surged nearly 11% after the company said Thursday it started a final-stage study of its experimental Covid-19 vaccine in the U.K. The stock, which has been popular among investors using the Robinhood app, has gained some 2,700% this year.
Barclays analysts touted a more bullish outlook for cruise lines and said in a Friday research note the sector is "nearing an inflection point." The cruise industry has been proposing safety measures in hopes of bringing back limited voyages from the U.S. Norwegian Cruise Line Holdings advanced 13%, while Carnival rose 9% and Royal Caribbean Group added nearly 8%.
"As we go into the fourth quarter, risks are starting to pile up, making it harder for equities to make gains. It's the election risk, the Covid risk, and the fiscal risk," said Seema Shah, chief strategist at Principal Global Investors. "And then of course the economic data: we've had all the easy gains in the third quarter and we want to be sure that momentum isn't running out."
Overseas, the pan-continental Stoxx Europe 600 fell 0.1%.
The major Asian equity benchmarks ended the week on a mixed note. Japan's Nikkei 225 rose 0.5% Friday, while China's Shanghai Composite Index ticked down 0.1%.
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