The S&P 500 and Dow Jones Industrial average were both higher on Friday after Trump indicated the United States may not have to impose further tariffs on Chinese goods. At the same time, a decline in the shares of Nvidia dragged down the Nasdaq.
All three indexes had fallen in early trading as an underwhelming outlook from Nvidia weighed on the tech sector.
Nvidia’s shares fell 18.8 percent after the company indicated that the decline in cryptocurrency mining as the cause of its declining sales. The shares also weighed on the Philadelphia SE Semiconductor index, which fell 1.2 percent.
Facebook shares were down 3.0 percent upon renewed concerns that the company could face regulatory scrutiny following a New York Times report on Wednesday about the company’s attempts to deflect criticism of its handling of Russian propaganda.
Comments from Richard Clarida, newly appointed Federal Reserve vice chair, that U.S. interest rates were nearing the central bank’s estimates of a neutral rate also lent support to stocks, investors said.
For the week, however, all three indexes posted losses. The S&P 500 was down 1.61 percent, the Dow lost 2.22 percent, and the Nasdaq chalked up a loss of 2.15 percent.
S&P 500 energy index rose 1.1 percent as oil prices recovered from sharp losses this week on expectations that OPEC and its allies would agree to cut output next month.
S&P 500 utility stocks were also higher, advancing 1.3 percent, as PG&E shares surged 37.5 percent. Statements from the California Public Utilities Commission raised hopes that the embattled company could be spared from bankruptcy if it were found liable for the state’s deadliest-ever wildfire.
Consumer discretionary stocks fell 0.5 percent. Continuing a gloomy week for retailers, shares of department store operator Nordstrom fell 13.7 percent after quarterly same-store sales missed estimates and the company reported charges from a credit card problem.
Approximately 8.18 billion shares changed hands on the major domestic equity exchanges, as compared to the 8.61 billion share average over the past 20 trading days.
Manufacturing Has Positive Tone
Manufacturing output increased for a fifth straight month in October, shrugging off a sharp decline in motor vehicle production and suggesting underlying strength in factory activity despite signs of a slowdown in the sector.
The Federal Reserve said on Friday manufacturing production rose 0.3 percent last month. Data for September was revised up to show output at factories increasing 0.3 percent instead of advancing 0.2 percent as previously reported.
Motor vehicle production fell 2.8 percent after increasing 1.3 percent in September. Excluding motor vehicles and parts, manufacturing gained a solid 0.5 percent last month, boosted by a strong increase in the output of business equipment. That followed a 0.2 percent rise in September.
Manufacturing, which accounts for about 12 percent of the economy, is being supported by a strong domestic economy. But growing capacity constraints amid labor shortages and more expensive raw materials are slowing momentum. A strong dollar and cooling global growth are restraining exports.
Reports on Thursday offered a mixed picture of regional manufacturing activity in early November. Factory activity in New York state expanded moderately this month, but it slowed sharply in the mid-Atlantic region.
October’s rise in manufacturing production offset decreases in mining and utilities output, leading to a 0.1 percent gain in industrial production last month. Industrial output rose 0.2 percent in September.
The Fed said Hurricanes Florence and Michael had lowered the level of industrial production in both September and October, but the effects of the storms “appear to be less than 0.1 percent per month.”
Mining output fell 0.3 percent in October after slipping 0.1 percent in September. Oil and gas well drilling rebounded 1.6 percent after declining for three straight months.
Capacity utilization for the manufacturing sector, a measure of how fully firms are using their resources, rose to 76.2 percent in October, the highest since July 2015, from 76.1 percent in September. Overall capacity use for the industrial sector fell to 78.4 percent from 78.5 in September. It is 1.4 percentage points below its 1972-to-2017 average.
Officials at the Fed tend to look at capacity use measures for signals of how much “slack” remains in the economy — how far growth has room to run before it becomes inflationary.