Stocks traded mostly higher on Friday, Jan. 19, even as investors grew increasingly concerned the federal government will be forced into a shutdown at midnight unless lawmakers can reach an 11th-hour agreement on funding.
The Dow Jones Industrial Average slipped 0.15% to 25,978, the S&P 500 rose 0.08% and the Nasdaq was up 0.12%.
The House of Representatives passed a continuing resolution late Thursday, Jan. 18, that would continue funding the federal government until Feb. 16, but the bill is unlikely to pass the Senate in its current form, setting up a battle between Republican and Democratic lawmakers over immigration protections for the so-called Dreamers and spending on Donald Trump's promised border wall.
That political risk backdrop played on both the U.S. dollar and Treasury bond yields overnight, pushing the dollar index to fresh three-year lows of 90.23 against a basket of six global currencies before paring losses to 90.44 on Friday and lifting benchmark 10-year Treasury yields to a September 2014 high of 2.64%.
The Stoxx Europe 600 benchmark gained 0.55%, while Asian shares finished Friday's session to the upside.
Consumer sentiment in the U.S. in January fell to 94.4, the worst reading since July, according to the University of Michigan.
Shares of International Business Machines Corp. (IBM) fell 3.5% on Friday as investors reacted cautiously to the company's outlook even as it posted its first quarterly revenue increase in more than five years.
IBM told investors after the close of trading on Thursday that it expects operating profit for the current fiscal year of at least $13.80 a share, a figure that is essentially unchanged from 2017 and shy of the Wall Street consensus of $13.92. The Armonk, N.Y.-based tech company also said it anticipates a full-year tax rate of around 16%, nearly four percentage points higher than what it paid over the course of 2017 as changes in the U.S. corporate code trim its bottom line.
American Express Co. (AXP) fell 1.4% after the credit card giant posted its first quarterly loss in 26 years and said it would suspend its stock buyback program because of the new U.S. tax law.
American Express posted a $1.2 billion quarterly loss after booking a $2.6 billion charge related to the new tax law. The charges were mostly tied to profits American Express had earned abroad and was now returning to the U.S. under a special one-time tax program.
Shares of Nvidia Corp. (NVDA) rose 1.6% after Bank of America Merrill Lynch raised its price target on the graphics chipmaker to $275 a share.
BAML said Nvidia's strength in the gaming space, as well as its dominance in artificial intelligence and virtual reality technologies as well as its recent tie-ups in the autonomous vehicle industry justify its forward price/earnings valuations and point to further upside gains.
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Shares of ADT Inc. (ADT) opened at $12.65 on Friday, below the home-security company's initial public offering price of $14 a share.
Square Inc. (SQ) jumped 4.3% after analysts at Instinet raised their target price on the payments company by $16 to $64.
Global oil prices fell on Friday following data and projections that suggested U.S. crude output was set to accelerate over the near-term.
West Texas Intermediate crude, the U.S. benchmark, fell 0.7% to $63.44 a barrel, and Brent crude was down 0.46% to $68.99.
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