Investors sent stocks modestly higher Friday, embracing a sluggish gross domestic product reading that was nonetheless better than expected, hoping that falling oil prices would help spur the economy. The major benchmarks all finished the week higher.
The 2.8 percent GDP growth in the second quarter, a revision from the 3 percent preliminary figure reported in July, is a far cry from the 4.5 percent growth in the first quarter. However, the figure was slightly better than the 2.7 percent expansion economists had forecast.
Still, with the Republican National Convention next week and traditionally slow trading in August, volume on the major markets remained extremely low -- it was the lightest trading day of the year on the New York Stock Exchange -- and any boost in stocks would be seen as tentative at best, analysts said.
The Dow Jones industrial average was up 21.60, or 0.2 percent, at 10,195.01; the Nasdaq composite index gained 9.16, or 0.5 percent, to 1862.08; and Standard & Poor's 500-stock index was up 2.68, or 0.2 percent, at 1107.77.
For the week, the Dow gained 0.8 percent, the S&P was up 0.9 percent and the Nasdaq rose 1.3 percent. It was the second straight week of gains for the Nasdaq and the third straight week higher for the Dow and S&P.
Economists said the second quarter GDP growth was hampered by energy costs, which the Commerce Department said kept many consumers from spending as much on goods and services. The GDP growth was also restrained by the nation's ballooning trade deficit, which showed that what money consumers were spending was heading to overseas companies.
Falling energy costs have also given corporate America reason to hope after a weaker second quarter. The Commerce Department reported that after-tax corporate profit fell $11.3 billion in the second quarter from the first quarter but were up 17.9 percent year over year.
Chattem, maker of consumer health and hygiene products, rose $1.34, to $30.26, after it boosted its third-quarter earnings outlook and reduced its estimate of settlement costs related to class-action lawsuits over its Dexatrim diet pills.
Microchip equipment maker Novellus Systems lowered its earnings and sales estimates due to low demand, prompting Lehman Brothers to cut its second-half estimates for the company. Novellus was nonetheless up 53 cents, at $25.18.
Pharmaceutical company Chiron tumbled $4.08, to $43.41, after it said deliveries of flu vaccines would be delayed due to contamination issues.
* The New York Stock Exchange composite index rose 15.72, to 6455.52; the American Stock Exchange index rose 7.77, to 1229.50; and the Russell 2000 index of smaller-company stocks rose 4.42, to 551.67.
* Advancing issues outnumbered declining ones by 2 to 1 on the NYSE, where trading volume fell to 844 million shares, from 1.02 billion on Thursday. On the Nasdaq Stock Market, advancers outnumbered decliners by 5 to 3 and volume totaled 1.01 billion, down from 1.16 billion.
* The price of the Treasury's 10-year note fell 94 cents per $1,000 invested, and its yield rose to 4.23 percent, from 4.21 percent on Thursday.
* The dollar rose against the Japanese yen and the euro. In late New York trading, a dollar bought 109.63 yen, up from 109.33 late Thursday, and a euro bought $1.2016, down from $1.2115.
* Light, sweet crude oil for October delivery settled at $43.18, up 8 cents, on the New York Mercantile Exchange.
* Gold for current delivery fell to $403.30 a troy ounce, from $407.40 on Thursday, on the New York Mercantile Exchange's Commodity Exchange.