Post-Christmas trading was slow on Friday. GMAC will become a bank holding company, while Amazon.com said its holiday season was busy
U.S. stocks ended higher Friday amid slow trading on the day after Christmas. Most Asian and European markets were closed for the holidays.
S&P MarketScope notes that the U.S. market is seeing some year-end portfolio adjusting.
While some observers say a "Santa Claus" rally is underway, many others are skeptical as the 2009 economic outlook is grim. Various trade groups reported weak Christmas retail sales, but Amazon.com (AMZN) was more upbeat. Despite mixed reports, "this is likely to be the worst holiday season for retailers in decades," according to Action Economics. Many are looking for post-Christmas sales to boost 2008 results, according to S&P.
Bonds were higher with yields down to record lows as the Federal Reserve tries to pump up the U.S. banking system. The volatile dollar index was up a bit. Gold futures were higher. Oil futures were higher after their recent slump.
On Friday, the 30-stock Dow Jones industrial average rose 47.07 points, or 0.56%, at 8,515.55. The broader S&P 500 index added 7.38 points, or 0.85%, to 872.80. The tech-heavy Nasdaq composite index rose 5.34 points, or 0.35%, at 1,515.55.
On the New York Stock Exchange, 22 stocks rose for every seven moving lower. On the Nasdaq, the ratio was 16 to 10 positive.
Goldman Sachs expects "this recession to be the worst in the post-World War II era when measured by the cumulative increase in the jobless rate." Goldman economist Jan Hatzius added: "A sharp retrenchment by the private sector is in train as consumers and businesses contend with tight financial conditions and a need or desire to delever. Under these circumstances, the US economy needs the government to step in with fiscal stimulus."
Among stocks in the news Friday, the GMAC Financial Services unit of General Motors (GM) said its application to befcome a bank holding company under the Bank Holding Company Act of 1956, as amended, has been approved by the Board of Governors of the Federal Reserve System. In addition, GMAC Bank has received approval from the Utah Dept. of Financial Institutions (UDFI) to convert to a state bank. As a bank holding company, GMAC will have expanded opportunities for funding and access to capital, which will provide increased flexibility and stability.
Wal-Mart Stores (WMT) announced Apple's (AAPL) iPhone 3G will be available for sale at nearly 2,500 Wal-Mart stores starting Dec. 28.
Amazon.Com (AMZN) announced the 2008 holiday season was its best ever. The online retailer sold over 6.3 million items, a record, on its peak day of Dec. 15.
Jones Apparel Group (JNY) moved sharply higher after it re-adjusted credit facilities to gain greater flexibility. The firm reduced a $750-million facility maturing in May 2010 to $600 million, and ended a $500-million facility that matures in June 2009.
Osteotech Inc. (OSTE) said that, during an inspection of donor recovery sites in Bulgaria by French regulatory agency Afssaps in November, 2008, deficiencies were identified in the maintenance of records related to six donors. As a precautionary measure, the company has temporarily suspended distribution of allograft tissue grafts processed from tissue recovered by its unit, TB OsteoCentre Bulgaria EAD (OCBG). Also, in cooperation with Afssaps, Osteotech has recalled 37 unused OCBG related tissue grafts previously distributed in France.
Integral Systems (ISYS) posted earnings of 28 cents per share, vs. 23 cents a year ago, as revenue rose 28%. Wall Street analysts were expecting earnings of 20 cents per share.
In other U.S. markets Friday, the 30-year bond was up 20/32 to 138-23/32 for a yield of 2.607%; the 10-year note rose 12/32 at 114-08/32 for a yield of 2.147%; and the 2-year note gained 01/32 to 99-31/32 for a yield of 0.899%. Trading was thin, and S&P's MarketScope said Treasuries "got boost from industry reports that showed consumer spending fell during the holiday season, adding to concern that an economic slump will lead to deflation."
The dollar index was higher at 80.88.
West Texas Intermediate crude oil futures were higher at $36.93 per barrel.
February gold futures were higher at $851.60 per ounce.