U.S. stocks rose, paring the biggest weekly drop for the Standard & Poor’s 500 Index since November, amid better-than-estimated earnings and Group of 20 nation talks aimed at bolstering the global economy. The yen weakened, gold climbed above $1,400 an ounce and oil advanced.
The S&P 500 gained 0.9% at 4 p.m. in New York, trimming its weekly loss to 2.1%. The Dow Jones Industrial Average’s gain was limited to less than 0.1% as International Business Machines Corp. plunged the most since in eight years after posting disappointing earnings. Japan’s currency tumbled at least 0.9% against all 16 major peers. Ten-year Treasury yields climbed two basis points to 1.70%. Gold for immediate delivery rose for a fourth day. The pound weakened as Britain lost its top credit grade at Fitch Ratings.
Capital One Financial Corp., Chipotle Mexican Grill Inc. and Microsoft Corp. climbed at least 3.4% to help lead the market higher after reporting quarterly results that beat estimates. G-20 finance chiefs handed Japan leeway to reflate its stagnant economy by indicating its fresh round of monetary stimulus doesn’t contravene a pact to avoid a currency war.
“Earnings have more of an impact on the market at this time of the year,” Lawrence Creatura, a Rochester, New York- based fund manager at Federated Investors Inc., which oversees about $380 billion, said by phone. “Macro issues are taking a bit of a backseat as investors stop to listen to what management teams have to say. Today’s reports have been mainly good with the exception of IBM.”
Volume of S&P 500 stocks was 17% higher than the 30- day average for this time of day. U.S. options contracts expire today, leading investors to adjust their holdings of some stocks.
The S&P 500 retreated 3.3% from its record close on April 11 through yesterday, spurring concern over what UBS AG strategist Jonathan Golub called a “spring break” in equities. Stocks began short-term declines in April of each of the last three years. The benchmark measure surged as much as 136% from a 12-year low in 2009 as the Federal Reserve embarked on three rounds of bond purchases to stimulate the economy.
Boeing Co. rallied 2.1% after winning U.S. approval to return to service with a redesigned lithium-ion battery, more than three months into the government’s longest grounding of a commercial model in the jet age.
IBM slid 8.3%, the most since April 2005, after the computer-services provider posted profit that trailed projections for the first time since 2005, hurt by a hardware slump and failure to sign customers to contracts. IBM, which accounts for 10% of the price-weighted Dow average for its heaviest weighting, by itself took 131.7 points off the 30- stock gauge today, trimming the average’s advance to less than 14 points.