Wall Street ends higher
Stocks advance as investors respond to preliminary holiday sales figures.
NEW YORK (CNNMoney.com) -- Stocks closed higher Friday, for the second session in a row, in a sparsely traded, post-holiday session.
The Dow Jones industrial average (INDU) was up 0.5% according to early tallies. The broader Standard & Poor's 500 (SPX) index advanced 0.8%. The Nasdaq composite (COMP) was down 0.3%.
U.S. markets were closed Thursday for the Christmas holiday.
On Wednesday, however, stocks managed modest gains in an abbreviated session as investors mulled reports on unemployment, manufacturing activity and consumer spending.
Oil and gold prices rose. U.S. Treasury debt also advanced while the dollar lost ground against the euro and the yen.
Trading has been subdued all week with many market participants on vacation. In addition to low participation, many investors have closed their books for the year and are not planning to take new positions until 2009.
With so many fund managers out of pocket, the market is experiencing "an influx of no interest," said Hugh Johnson, chairman of Johnson Illington Advisors, an Albany, N.Y.-based firm with nearly $700 million in assets under management.
Still, investors are "trying to size up what the retail season has been like," Johnson said. "While it's still hard to say, from everything I've seen, sales looks pretty dismal," he added.
Weak retail sales - particularly during the holiday season when most retailers earn the bulk of their income - are a major concern for investors since retail sales constitute two-thirds of the nation's overall economic activity.
Holiday sales: The first post-Christmas report on the holiday shopping period from Nov. 1 to Dec. 24 was not promising, with a report from MasterCard Worldwide unit SpendingPulse showing sales excluding gasoline down as much as 4% compared to last year.
The report called 2008 "one of the most challenging holiday shopping seasons in decades." The weak national economy was primarily to blame, with bad weather throughout the nation during the final week adding to the disappointment.
SpendingPulse said the apparel, electronics and luxury sectors were especially hard-hit this season.
The figures were significantly lower than the 2.2% rise in retail sales that the National Retail Federation, the world's largest retail trade association, had forecast.
GMAC: The Federal Reserve on Wednesday approved GMAC's request to become a bank holding company.
The move paves the way for General Motors' troubled finance unit to gain access to much needed federal bailout money. GMAC's exposure to illiquid mortgage-backed securities was a major threat to the automaker, which is already on the verge of collapse due to weak sales and tight credit.
Earlier this month, the Bush Administration said it will extend $13.4 billion in emergency loans for GM and Chrysler to help keep the companies out of bankruptcy.
Shares of GM (GM, Fortune 500) were up nearly 13%.
Other markets: In global trading, Asian markets were mixed, with Japan's Nikkei advancing 1.6% and the KOSPI index in South Korea falling nearly 1%. Hong Kong was closed for the holiday. European stock exchanges were also closed.
The dollar fell versus the euro and rallied against the yen.
U.S. light crude oil for February delivery was rose $2.36 to settle at $37.71 a barrel in New York.
COMEX gold for February delivery was down $23.20 to $871.20 an ounce.
Gasoline prices fell overnight to a national average of $1.642 from $1.655 a gallon, according to a survey of credit-card swipes released Monday by motorist group AAA.
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