U.S. stocks turned higher on Friday, with equities marking a 10th week of alternating returns, as Wall Street fixated on whether the Federal Reserve would begin raising interest rates next week.
Stocks had started lower after Goldman Sachs Group cut its price outlook for crude oil, with the energy sector hardest hit among the 10 major industry groups in the S&P 500 (spx), which gained nearly 9 points, or 0.5 percent, at 1,961. The Dow Jones Industrial Average (dji) rose 103 points, or 0.6 percent, to 16,433. The Nasdaq Composite (comp) added 26 points, or 0.5 percent, to 4,822.
"It's the Friday ahead of a weekend and the [Fed] meeting next week. We'll probably close the week with averages mixed," Peter Cardillo, chief market economist at Rockwell Global Capital, said. "The big story is the price of oil -- Goldman cut their estimate, and that's what is taking some steam out of the market -- that, and anxiety over the Fed."
In a report issued Friday, Goldman reduced its forecast for crude oil through 2016, saying it expects the current global surplus of the commodity to persist next year. The investment firm added its name to a growing lists of banks slashing price projections, cutting its 2016 outlook for West Texas Intermediate to $45 a barrel from $57 previously, and Brent to $49.50 from $62.
Views vary wildly as to whether the Fed will opt to bring an end to its seven-year policy of zero interest rates at the conclusion of a two-day meeting Sept. 17 of the Federal Open Market Committee. Some predict a new interest rate of o.25 percent could settle matters for many investors.
"I think they are going to raise interest rates. They need to stay ahead of the curve and they need to retain credibility," Cardillo said. "They need to stabilize the market. If they raise by 25 basis points and do not signal an aggressive program going forward, it would clear the air and help emerging markets."
A report released Friday had consumer sentiment dropping this month to its lowest in a year. The University of Michigan's preliminary index fell to 85.7, from 91.9 in August.
The measure of confidence "likely reflects the declines in stock prices, mediocre job gains, lackluster income growth and no acceleration in economic growth above current trends," Peter Boockvar, chief market analyst at the Lindsey Group, noted in an email. "For markets, confidence data shouldn't matter unless this gives the Fed another reason not to hike."
Separate data showed wholesale prices were little changed last month, curbed by the cheaper price of fuel.