U.S. stocks end week higher; Dow tops 13,000
NEW YORK (MarketWatch) -- U.S. stocks posted steep gains for a second day Friday, reclaiming a weekly advance as investors anticipated moves by the European Central Bank as well as the U.S. Federal Reserve.
Stocks hit session highs after Bloomberg News reported European Central Bank President Mario Draghi would hold talks with Bundesbank President Jens Weidmann in an attempt to remove the biggest obstacles to adopting new measures including bond purchases.
"Between Draghi's comments and the gross domestic product numbers today, we're bid up on prospects of monetary intervention," said Mark Luschini, chief investment strategist at Janney Montgomery Scott.
The Dow Jones Industrial Average (DJIA) ended up 187.73 points, or 1.5%, to 13,075.66, its first close above 13,000 since May 7 .
Friday's gains marked the second session of triple-digit increases for the Dow and its third day of gains, with rallies in the past two sessions underpinned by comments from European policy makers.
Stocks started the session higher after German Chancellor Angela Merkel and French President Francois Hollande said they were committed to keeping the euro area together. French newspaper Le Monde reported the European Central Bank was readying to purchase debt.Read more on Europe Markets.
On Thursday, the Dow had jumped more than 200 points after the ECB's Draghi suggested policy makers could step into bond markets, saying the ECB would do "whatever it takes to preserve the euro." Read more on Draghi.
The S&P 500 index (SPX) added 25.95 points, or 1.9%, to 1,385.97, extending gains into a second session. Health care and technology were the best performing of the index's 10 major industry sectors, all of which advanced. It rose 1.7% for the week.
The Nasdaq Composite (COMP) gained 64.84 points, or 2.2%, to 2,958.09.
The major stock indexes held gains after a gauge of consumer sentiment came in just above expectations, as did a separate report on U.S. economic growth in the second quarter. .
"Once again today's news is being treated somewhat perversely, as weak means quantitative easing. The numbers weren't so bad to scare anybody, but not good enough for the Fed to stay on the sidelines," said Luschini, who believes the Fed is unlikely to move until after the monthly jobs report next Friday.
Unlike some market observers, Luschini does not believe November's presidential election will keep the Fed sidelined in September. "I don't believe that is ignored, but at the same time I don't think that is going to be the motivation here," said Luschini, who believes Fed Chairman Ben Bernanke's consideration of the U.S. economy and his own legacy will come ahead of any political concerns.
For every stock declining, five gained on the New York Stock Exchange, where 912 million shares traded hands. NYSE composite volume was 4.4 billion, while Nasdaq composite volume was 2 billion.
Oil prices (CLU2) climbed for a fourth session, up 74 cents to finish at $90.13 a barrel on the New York Mercantile Exchange. Gold futures (GCQ2) advanced for a third day, up $2.90 to close at $1,618 an ounce on the Comex division of Nymex. Read more on oil.