NEW YORK — A late rally Friday prevented the stock market from having its worst week in nearly a year.
Investors seemed to largely ignore the ongoing debate in Washington over raising the country’s borrowing limit. Troubling questions over Europe’s financial health and manufacturing in the U.S. weighed down stock prices for much of the day, overwhelming a very strong earnings report from Google.
Google jumped nearly 13 percent, the most of any stock in the Standard and Poor’s 500 index, after the company said its revenue hit a record last quarter. Google’s earnings pushed tech stocks in the S&P broadly higher. Microsoft and Cisco each gained 1 percent.
Worries about Europe and weak factory output in the U.S. have kept traders’ expectations and stock prices relatively low since early this spring, said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research.
If corporate earnings remain strong and Europe stabilizes, he said, stocks might rally in the second half of the year. That happened last year, after fears about Europe held the stock market back all summer.
“With all the talk about European debt and the U.S. issues, the fact that earnings are coming in pretty strong is a good sign,” Detrick said. “Once those issues work their way through the system, long-term growth is going to come from earnings.”
Most investors believe a deal to raise the country’s debt ceiling will be reached before the Aug. 2 deadline.
The S&P finished with a gain of 7.27, or 0.6 percent, to 1,316.14. Most of the gains came in the last hour of trading. The Dow Jones industrial average added 42.61, or 0.3 percent, to 12,479.73. The Nasdaq composite rose 27.13, or 1 percent, to 2,789.80.
The late gains Friday trimmed the S&P 500’s weekly losses to 2.1 percent. Had the index closed where it was at 2:30 p.m., it would have been down 2.6 percent for the week, making it the worst week for the widely used market measure since last August.
Three stocks rose for every two that fell on the New York Stock Exchange. Volume was slightly higher than average at 4 billion shares. The Dow average fell 1.4 percent for the week, the Nasdaq 2.4 percent.
Bloomberg News contributed to this report.
