Stocks Close Mixed As Traders Digest Earnings News - U.S. Commentary

(RTTNews) - Stocks turned in another relatively lackluster performance during trading on Friday, as traders focused on the latest batch of earnings news amid a quiet day on the U.S. economic front.

The major averages eventually ended the session on opposite sides of the unchanged line. While the Nasdaq rose 15.57 points or 0.3 percent to 5,257.40, the Dow dipped 16.64 points or 0.1 percent to 18,145.71 and the S&P 500 edged down 0.18 points or less than a tenth of a percent to 2,141.16.

For the week, the Dow edged slightly higher, while the S&P 500 climbed by 0.4 and the Nasdaq advanced by 0.8 percent.

The tech-heavy Nasdaq benefited from a strong gain by Microsoft (MSFT), with the software giant jumping by 4.3 percent. With the gain, Microsoft reached a record closing high.

The advance by shares of Microsoft came after the company's first quarter adjusted earnings per share and revenues exceeded forecasts, helped by a strong performance by its Cloud business.

Global payments company PayPal (PYPL) also moved notably higher after reporting third quarter earnings that matched estimates and a growing number of active accounts.

Shares of McDonald's (MCD) moved to the upside after the fast food giant reported third quarter earnings and sales that beat analyst estimates. Global same-store sales rose 3.5 percent during the quarter.

Meanwhile, General Electric (GE) closed modestly lower after the conglomerate reported third quarter earnings that beat estimates but on lower than expected revenues. GE also lowered its full-year revenue growth forecast.

Sector News

While many of the major sectors ended the day showing only modest moves, considerable strength was visible among internet stocks. Reflecting the strength in the sector, the Dow Jones Internet Index advanced by 1.8 percent.

PayPal helped to lead the sector higher, although j2 Global (JCOM), Twitter (TWTR), and VeriSign (VRSN) also posted notable gains.

Tobacco stocks also saw some strength on the day, with Reynolds American (RAI) rising sharply after British American Tobacco (BTI) offered to acquire the 58 percent stake in the company it does not already own for $47 billion.

On the other hand, natural gas stocks came under pressure over the course of the session, dragging the NYSE Arca Natural Gas Index down by 1.7 percent. Southwestern Energy (SWN) posted a steep loss after reporting weaker than expected third quarter earnings.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Friday. Japan's Nikkei 225 Index fell by 0.3 percent, while Australia's All Ordinaries Index dipped by 0.2 percent. The Hong Kong markets were closed for a holiday.

Meanwhile, the major European markets ended the day roughly flat. While the German DAX Index inched up by 0.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both edged down by 0.1 percent.

In the bond market, treasuries showed a lack of direction before closing roughly flat for the third consecutive session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.740 percent.

Looking Ahead

Next week's economic calendar is relatively light, but traders are likely to keep an eye on reports on consumer confidence, new home sales, durable goods orders, and third quarter GDP.

A slew of well-known companies are also due to release their quarterly results next week as earnings season hits full stride.

Visa (V), 3M (MMM), Caterpillar (CAT), General Motors (GM), Procter & Gamble (PG), Sprint (S), AT&T (T), Coca-Cola (KO), Dow Chemical (DOW), Sony (SNE), UPS (UPS), Twitter (TWTR), and Exxon Mobil (XOM) are just a few of the companies due to report their results.