The stock market traded mixed late in the afternoon as home sales fell and negative news on the economy outweighed strong earnings reports from the retail sector.
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The Nasdaq composite fell 0.2% and the S&P 500 gained 0.2%. The Dow Jones Industrial Average gained 0.1%. The Russell 2000 Small Cap Index rose 0.2%.
Volume fell on the NYSE and Nasdaq from the same time Thursday.
The yield on the benchmark 10-year Treasury note rose 12 basis points to 3.82%.
Crude oil prices fell 2% to $80 a barrel as U.S. oil futures signaled possible oversupply for the first time this year.
The S&P Energy Select Sector ETF (XLE) slid 1.1% on Friday, the worst performance of the 11 S&P sectors. The S&P Utilities Sector ETF (XLU) was the best, gaining 2%.
Stock market mixed as home sales fall
In other economic data, existing home sales fell 5.9% in October and showed continued weakness in housing demand over the past nine months. All regions of the United States posted declines.
“The sharp rise in mortgage rates of late has brought housing demand to a screeching halt, with some areas seeing the worst sales figures in more than a decade,” said Peter Essele, head of portfolio management for Commonwealth Financial Network.
Meanwhile, Boston Federal Reserve Chair Susan Collins said she expects the central bank to raise rates in December. “All possible raises should be on the table as we decide what’s tight enough,” Collins said in an interview with CNBC.
The likelihood of the Fed raising rates by 0.5% in December fell slightly to 75.8%, while the odds of a 75 basis point hike are up to 24.2%, according to the tool. CME FedWatch.
Manufacturer of irrigation systems Lindsay (LNN) went from a cutting base to new highs on Friday. Lindsay Shares IBD Farm Machinery Group Top Rating With John Deere (DE), which publishes its results next week. Deere stock held its gains well after breaking above the 400 level and a buy point of 406.12.
Manufacturer of building products Griffin (GFF) also made new highs and is extended past its buy point of 33.63.
Retail profits boost stocks as holiday season approaches
Applied materials (AMAT), Ross Stores (ROST), Palo Alto Networks (PANW) and Difference (GPS) all beat views late Thursday and early Friday.
AMAT’s sales of $6.75 billion and earnings of $2.03 per share beat estimates of $6.45 billion and $1.73. The chip-equipment maker cut its fourth-quarter outlook by $400 million due to the Covid lockdown in China. Stocks pared most of the gains late in the afternoon and are testing the 200-day line.
Palo Alto Networks posted revenue of $1.6 billion and earnings of 83 cents per share, beating estimates of $1.55 billion and 69 cents. PANW stock rose more than 7% on Friday, topping its 50-day line.
Ross had revenue of $4.6 billion with earnings of $1 per share. ROST stock has climbed nearly 10% and is on course for its best stock market performance since Nov. 9, 2020, when it rose 15.6%, according to Dow Jones Market Data.
Gap posted sales of $4.04 billion and earnings of 77 cents per share. GPS stock rose more than 6%, the highest price since April.
Chinese company takes advantage of lockdowns in China
Chinese e-commerce giant JD.com (JD) beat views and withstood pressure from lockdowns in China, earning 38 cents a share on sales of $34.2 billion. Shares fell more than 3% as they tested resistance at the 200-day line.
Foot locker (FL) beat the high and low estimates and raised its outlook. The stock rebounded more than 7%. It forms a cup base with a buy point of 40.10.
lululemon (LULU) fell 2% on Friday in stock trading, but is still close to a buy point. This Big Cap 20 stock is counting on consumers to hit the table this season and take a bite out of its bloated inventory. It publishes its results for the third fiscal quarter on December 8.
The Innovator IBD 50 (FFTY) ETF fell 0.6%, weighed down by oil stocks such as Diamondback Energy (CROC), Exxon Mobil (XOM) and Conoco Phillips (COP).
Follow Michael Molinski on Twitter @IMmolinski
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