Market Snapshot: Dow, S&P and Nasdaq all trade at records after retail sales, trade optimism rebound

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U.S. stock indexes opened in record territory Friday, after data on retail sales rebounded to show growth in October and after White House officials again talked up the prospects of a trade deal with China

How are the major benchmarks faring?

The Dow Jones Industrial Average  DJIA, +0.30% rose 96 points, or 0.3%, to 27,875, while the S&P 500 index   SPX, +0.30% gained 12 points, or 0.4%, to trade at 3,108. The Nasdaq Composite index  COMP, +0.36% gained 44 points, or 0.5%, to 8,522.

All three benchmarks were trading above their previous record closes and set new intraday highs Friday morning.

On Thursday, the Dow  ended marginally lower, falling 1.63 points to 27,781.96, a day after eking out a record close. The S&P 500, meanwhile, tiptoed further into uncharted territory with a rise of 2.59 points, or 0.1%, to end at 3,096.63 — it’s 21st record close of 2019. The Nasdaq Composite  edged 3.08 points lower, a decline of less than 0.1%, to finish at 8,479.02.

For the week, the Dow is on pace to rise 0.7%, the S&P 0.5% and the Nasdaq less than 0.6%.

Read: ‘Hindenburg Omen’ and ‘Ohama Titanic Syndrome’ form in a key stock-market index

What’s driving the market?

Equities markets have clung to slight gains this week as investors remain hopeful that positive developments in U.S.-China trade relations will soon justify recent record highs for the major stock indexes.

“Investors continue to hang onto every word associated with the U.S.-China trade war,” said Russ Mould, investment director at AJ Bell. “White House economic adviser Larry Kudlow reportedly said that current negotiations between the two countries are ‘very constructive’, which was enough to drive stock markets up across the U.K., mainland Europe and most of Asia.”

Kudlow on Thursday said negotiators are getting close to an agreement, but that President Donald Trump wasn’t yet ready to sign off. Trump “likes what he sees, he’s not ready to make a commitment, he hasn’t signed off on a commitment for phase one, we heave no agreement just yet for phase one,” he said at a Council on Foreign Relations event, according to The Wall Street Journal.

U.S. retail sales growth rebounded in October, rising 0.3% after a 0.3% decline in September, above the 0.2% growth expected by economists surveyed by MarketWatch. Excluding autos and gasoline sales, however, sales rose 0.1%, below the 0.4% consensus forecast.

The New York Federal Reserve’s November Empire State index, a gauge of regional activity, came in below expectations, with a reading of 2.9 in November, a 1.1 decrease from October and below economists expectations of a 5.0 reading, according to a MarketWatch poll.

But U.S. industrial output fell by the most in 17 months in October, down 0.8%, worse than the 0.5% decline expected by economists polled by MarketWatch. Industrial capacity in use slumped to 76.7 in October, the lowest level in slightly more than two years.

Which stocks are in focus?

Shares of Applied Materials Inc. AMAT, +8.15%  were expected to be in focus after the chip-equipment company late Thursday reported a fall in profit from a year ago, but topped Wall Street expectations. The company’s outlook also backed up earlier reports from the chip-equipment sector pointing to a recovery for the beaten-down semiconductor industry. Shares rallied 7.3% Friday.

Chip maker Nvidia Corp. NVDA, -3.80%  late Thursday forecast a return to revenue growth after four quarters of declines and beat estimates for its quarterly results. Shares rose 0.2% Friday.

Shares of furniture maker RH RH, +5.52%  were up more than 8% Friday after Warren Buffett’s Berkshire Hathaway Inc. BRK.B, +0.12% BRK.A, +0.03%  revealed in a regulatory filing that it had bought 1.2 million shares of the company formerly known as Restoration Hardware.

Berkshire also revealed that it owned nearly 7.5 million shares of Occidental Petroleum Corp. OXY, +3.07%  worth around $332 million as of the end of the third quarter. Berkshire in April committed $10 billion to help Occidental in its bid for Anadarko Petroleum Corp, giving the company an edge over Chevron Corp. CVX, -0.26%, which later bowed out of the fight for Anadarko.

Shares of J.C. Penney Co. Inc. rallied more than 10% after the department store retailer reported narrower-than-expected losses in the third quarter.

How are other markets trading?

The yield on the 10-year U.S. Treasury note TMUBMUSD10Y, +0.62%  rose 2.1 basis points to 1.833% on rising trade hopes, after falling to a weekly low on Thursday.

The price of a barrel West Texas Intermediate crude oil for December delivery CLZ19, +0.21%  rose 16 cents, or 0.3% to $56.91, though the commodity was still on track for weekly losses. The price of an ounce of gold for December delivery GCZ19, -0.51%  declined $5.30, or 0.4%, to $1468.10 as the safe haven lost appeal.

The value of the U.S. dollar edged 0.1% lower, according to the ICE U.S. Dollar index DXY, -0.14%.

In Asia overnight, stocks traded mixed, with the China CSI 300 000300, -0.74%  falling 0.7% and the Shanghai Composite index SHCOMP, -0.64%  declining 0.6%. Japan’s Nikkei 225 NIK, +0.70%, meanwhile, rose 0.7% while Hong Kong’s Hang Seng index HSI, +0.01%  was virtually unchanged on the session.

In Europe, stocks were trading mixed, with the Stoxx Europe 600 SXXP, +0.22%  up 0.1%