U.S. stocks inched up to close at fresh record highs on Friday, even though President Trump cast doubt on progress in concluding a U.S. trade deal with China after optimism that the long running dispute would be resolved had powered the week’s rally.
The Dow gained for a third straight week while the benchmark S&P 500 index notched a fifth week of gains as the U.S. third quarter earnings reporting season wound down.
How did the major benchmarks perform?
The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +3.44% added 6.44 points, or 0.02% to close at a new record of 27,681.20, the S&P 500 index /zigman2/quotes/210599714/realtime SPX +3.41% advanced 7.90 basis points, or 0.26%, to seize a fresh closing high of 3,093.08. The Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP +2.58% rose 40.80 points, or 0.48%, at 8,475.31, another record.
On Thursday, the Dow and S&P 500 each posted a record close, while the Nasdaq Composite saw its second-highest close in history, according to Dow Jones Market Data.
For the week, the Dow added 1.2% while the S&P 500 gained 0.8% and the Nasdaq advanced 1%.
What drove the market?
Stock markets rallied into the close Friday even amid growing doubts about the willingness of the U.S. to pare import duties in stages as a part of its partial China trade pact, after President Trump told reporters he hasn’t yet approved such a measure.
Peter Navarro, a senior U.S. trade adviser, said late Thursday that there was no formal agreement in place and the final decision would lie with Trump, according to The Wall Street Journal.
But the latest doubts about resolving the trade war were unable to upend the week’s overall stock market rally, which gained steam after China’s Ministry of Commerce said an agreement had been achieved to jointly eliminate some tariffs in stages as a part of the phase-one pact.
“There is a lot of noise that can distract people but when it comes down to it, when you set aside politics and social concerns, markets are driven by fundamentals,” Kevin Philip, managing director at Los Angeles-based Bel-Air Investment Advisors told MarketWatch.
“It’s really hard to have a recession, or some sort of crisis, when you have full employment, a friendly Fed and a government that’s lowering regulations and has lowered taxes,” he said.
Enthusiasm about the ability of the U.S. economy to keep chugging along, despite its record expansion, also has filtered over to the Russell 2000 index /zigman2/quotes/210598147/delayed RUT +4.61% , the benchmark for smaller stocks, where a bullish “golden cross” price pattern is starting to take shape and may signal a firmer breakout is on the horizon.