A Winning Week on Wall Street and Worldwide

Yes, stocks remained higher all week for the first time in nearly two months. Friday also brought this quarter’s “Quadruple Witching,” when contracts expire for stock index futures, stock index options, stock options and single stock futures on a single day.

The biggest winner was the Nasdaq, which gained 6.3% percent for the week. The S&P closed at 1,216.01, an increase of 5.4 percent for the week, and an increase of nearly a hundred points from five weeks ago. The Dow Jones jumped nearly 517 points, or 4.7%, and closed at 11,509.09. On Friday, stocks started and ended the day strong, with a brief slump in between. The Dow posted a gain of 0.7% and the Nasdaq and S&P followed suit with 0.6% each.
Textron, Inc, owners of Cessna, Bell Helicopters and others, was the top-performing stock in the S&P this week, up more than 22%. The S&P 500’s rise was buoyed by technology stocks. Shares of online auctioneer Ebay soared 18%, while Dell shares increased by 8.8 percent after Dell funneled some $5 billion into its stock buyback program.

With the start of a new academic year, textbook publishers McGraw-Hill are having a very good week, watching their shares add 17%.  Hartford Financial rose 14 percent in response to a boost in its rating from Credit Suisse, who upgraded Hartford from “neutral” to “outperform.” Sears Holdings, parent company of Sears and Kmart, climebd 14%. Insurance giant Aetna was up 9.3 percent after an announcement that it expects profits to outperform estimates.

Netflix stock, however, is still weighing down the S&P and the Nasdaq. Netflix had the sharpest decline in the S&P this week – 24%. Shares of the movie-rental provider have been suffering since it announced a price hike that took effect on the first of the month. Competition from Blockbuster Total Access as well as rumors that competition may be in the works from Amazon are also making waves for the stock.

The Nasdaq’s gains were heavy on the pharmaceuticals industry. Transcept Pharmaceuticals was the top dog on the Nasdaq, skyrocketing 107.7% in the past week. Anadys Pharmaceuticals also performed well, up more than 47% in the same period, and followed by Catalyst Phamaceutical Partners, which rose 34.6%. Shares of Global Industries rose more than 52% and NetLogic Microsystems, Inc. rose more than 51%. Apple gained just shy of 2% to rest at $400.50 per share.

The Nasdaq had another albatross around its neck as well. Research In Motion (RIMM) lost nearly 19% after a poor earnings report was released late on Thursday. The report showed earnings that totaled less than half of what they had been the previous year. The company’s recently-incurred restructuring costs contributed to the disappointing profits. Meanwhile, shares of Adobe Systems had dropped 2.3%.

The Dow rode the upward mobility of companies such as Intel Corp., Home Depot, General Electric, IBM and Disney. Intel, which rose 11.5% for the week, had the best-performing stock in the DJIA. Second runner up was Home Depot, with an 8.6% gain and GE right behind them. Shares of American Express gained 6% for the week, just behind Disney in performance. Travelers Insurance Company rose 5.13 percent this week.

According to the U.S. Department of Commerce, which released its retail figures for August, retail sales were virtually unchanged. Sales excluding auto sales rose 0.1 percent, slightly lower than the private sector’s forecasted growth of 0.3 percent. Compared with August 2011, sales are up 7.2 percent.

The Consumer Price Index, which measures changes in the price of goods and services over time, has been released for the month of August. The CPI for All Urban Consumers increased 0.4 percent for the month of August on a seasonally adjusted basis. Before seasonal adjustment, the index has increased 3.8 in the past 12 months, according to the U.S. Bureau of Labor Statistics.

There have been steady increases in the cost of food, gasoline, shelter and apparel. For the month of August, the gasoline index rose 1.4 percent and the food index rose 0.5 percent. All items other than food and energy, including housing, apparel, and personal care, increased 0.2 percent, as they had in July. The cost index for new vehicles remained unchanged.

Late Friday night, U.S. auto-maker General Motors has reached a tentative agreement with the United Auto Workers union for a new labor contract. It is the first time a contract has been agreed upon since the company’s backruptcy and bailout in 2009. The contract will apply to some 48,500 workers, and will include rehiring workers who had been laid off during the recession. The contract will tie employee earnings to the company’s profits in a profit-sharing model. The new contract was reached about 48 hours after the previous contract had expired. Under the new agreement, base pay for new employees will increase by $2 an hour, from $14 to $16 per hour, and will top out at $19 rather than $16. The new contract will not take effect until it has received a vote of approval from rank-and-file union members.

According to the latest Empire State Manufacturing Survey, the climate for New York manufacturers appears to be worse for the fourth consecutive month. General business conditions declined one point to -8.8. The shipment index took a big hit, dropping 16 points to rest at -12.9. The Inventories index hit -12. New orders were unchanged. Prices paid and prices received increased. Employment indexes also showed decline. Future indexes cast a more positive light, suggesting that those surveyed expect business to pick up over the next few months. The future general business conditions index advanced four points to 13.0.

Markets in Asia closed up shop ahead, with the highest gains posted by Japan’s Nikkei, which rose 2.3%, Hong Kong’s Hang Seng Index rose 1.4%, and the Shanghai Composite barely moved to 0.1% higher.

European markets had a mixed close. London’s FTSE 100 lifted 0.6% and the DAX in Germany rose 1.2%, which France’s CAC 40 slid 0.5%.

Toronto’s TSX Composite also didn’t share in the good fortune, dropping 161.13 points, or 1.30% to 12,263.70.

Oil for October delivery declined to $87.96 a barrel, but is still $0.95 higher than last week’s price. Gold for December delivery closed at $1,814.70 an ounce, silver at $40.66.

Like last week, the dollar grew stronger again–against the Euro, British pound and yen.

Next week, the Federal Reserve is scheduled to meet for two days on September 20 and 21 to discuss the continuing debt situation in Europe.