By Donna Kardos Yesalavich
U.S. stocks put in an uneven performance Friday, with blue chips
falling and the other major indexes edging higher, as investors
marked time ahead of a weekend meeting of the Group of 20 finance
ministers.
The Dow Jones Industrial Average (DJI) shed 28 points, or 0.3%,
to 11119.
"The market is focused on earnings and buying some time here in
front of the FOMC [meeting] and the election," said Nick Kalivas,
vice president of MF Global. Traders may also be hesitating as a
meeting of finance ministers and central bankers from the Group of
20 big industrial and emerging economies got under way in Gyeongju,
South Korea.
The Dow's decline was led by American Express Co. (AXP) and
Verizon Communications Inc. (VZ) , as investors looked past
quarterly earnings from both companies that topped analysts'
estimates. Read more on American Express.
AmEx fell 2.5% on concerns that the company is seeing weak
demand for new loans, with lending volumes still below
pre-recession levels. Verizon dropped 2% on disappointment over
slowing subscriber growth in its wireless arm.
The Nasdaq Composite (RIXF) rose 0.6% to 2475 and the Standard
& Poor's 500-stock index (SPX) edged up 0.1% to 1181.
Technology stocks led the measure's gains, boosted by
encouraging earnings from chip-makers. SanDisk Corp. (SNDK) shares
climbed 2.4% after the memory chip maker's third-quarter profit
jumped 39%, benefiting from its use in tablet computers.
Also buoying technology stocks, Riverbed Technology Inc. (RVBD),
which makes products that reduces the load on networks, surged 20%
after its third-quarter revenue topped analysts' expectations and
its board approved a 2-for-1 stock split.
Among other technology stocks reporting earnings, Compuware
Corp. (CPWR), CA Inc. (CA) and Amazon.com (AMZN) all beat Street
estimates. Compuware jumped 12% while CA added 4.5% and Amazon
climbed 2.9%.
The energy sector got a big boost from Schlumberger (SLB) ,
which (EXC) climbed 4.9% after the oilfield-services company's
third-quarter earnings more than doubled, topping analysts'
expectations.
Meanwhile, utilities were weighed down by a 3.5% drop in Exelon
(EXC). The owner of nuclear plants posted a 12% increase in
third-quarter profit as hot summer weather gave power transmission
operations a boost, but investors were disappointed to see
operating margin narrowed to 25.8% from 32.3% as costs rose.
The mixed reactions to earnings come as investors are trying to
reconcile strength in profits, with nearly three-quarters of the
S&P 500 companies that have reported third-quarter results
topping earnings estimates, with other areas of concern as the
economy remains weak.
"We see companies generally acknowledging a mediocre U.S.
economy and that they are all almost very pleased with themselves
for managing through that," said Barbara Marcin, portfolio manager
of the Gabelli Blue Chip Value Fund. "Companies in their outlooks
are saying approximately the same thing--our markets and customers
are better than where they were a year ago, but we're in a
slow-growth environment."
The market is also watching whether the G-20 finance ministers,
in preparation for a G-20 summit in Seoul next month, can agree on
managing exchange rates to cool what's been called a "currency
war." Also on the G-20 agenda are proposed Basel III rules on
boosting banks' capital requirements and tighter rules on hedge
funds.
Nevertheless, the Dow industrials and the S&P 500 are on
pace to close the week in positive territory, which would mark
their third-straight week in the black and seventh weekly gain out
of the last eight weeks. The Nasdaq climbed narrowly into positive
territory for the week on Friday, up just 0.3%.
The U.S. Dollar Index (DXY) , tracking the U.S. currency against
a basket of six others, edged up 0.1%. Treasurys were mixed, with
the two-year note flat and the 10-year note down, lifting its yield
up to 2.57%. Crude-oil futures crept higher, while gold futures
slipped.
"Where the choppiness comes is that there are still a lot of
fundamental issues in the economy," David Hefty, chief executive at
Hefty Wealth Partners. "The banking sector, mortages, inflation in
emerging markets, deflation here, a mini-currency crisis -- those
issues are weighing on everybody's minds."
Among stocks in focus, Chipotle Mexican Grill (CMG) jumped 14%.
The restaurant chain's third-quarter profit rose 40% as same-store
sales and traffic improved. The company also boosted its same-store
sales target for the year.