Stocks held onto a gain Friday amid rising hope that the recession is moderating. The latest read on the U.S. gross domestic product revealed that the economy shrank by 1% in the second quarter, better than the Street's forecast.
The dollar softened, oil rose more than $2 a barrel, and the Dow moved higher. The Dow added 17, the S&P gained 1 point, and the Nasdaq dropped 6.
Auto stocks enjoyed a boost on speculation that the government's Cash for Clunkers program is increasing demand for cars. The program encourages consumers to trade old cars for credit to be applied to the purchase of new models. The U.S. House has voted to approve $2 billion in additional funding for the program. Ford Motor ( F - news - people ) added 8%.
Walt Disney Co. ( DIS - news - people ) was under pressure as J.P. Morgan downgraded the company to "underweight" from "neutral" on lackluster earnings. With consumer spending still weak, the company remains cautious on its outlook.
Defense contractor ITT ( ITT - news - people ) was a market leader on Friday, beating expectations by a wide margin with profits of $1.10 a share. ITT raised its full year forecast. Profits could come in as high as $3.70 a share.
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