Wild week ends up with tame move

Small-cap stocks edged higher Friday, waffling between support from commodity and industrial stocks and weakness from the financial arena (and curiously enough, restaurant stocks). The Russell 2000 (NYSE:IWM) closed up 1.27, or 0.18%, at 720.26. After what seemed like a frantic week of manic price swings, small caps finished out the entire week of trading with a miniscule gain of 0.18%. It was the kind of week that only a day trader with superlative entry and exit points could love.

The Dow closed out today’s action down 0.10% and is off 13.9% for 2008. Meanwhile, the S&P 500 was up 0.21% today and is down 14.7% for the year. Small caps so far in 2008 have been a relative refuge in a difficult year for the bulls, with the Russell off only 5.9% this year.

The combination of ongoing worries about the health of the financial system, weak retail sales, a profit warning by Chipotle Mexican Grill Inc. (NYSE:CMG) and cautious analyst comments on Apple Inc. (Nasdaq:AAPL) sparked worries about profit growth, Nick Kalivas, vice president of financial research with MF Global, said in an email interview.

Those concerns were offset, however, by strength in raw material stocks — a sector that was oversold after hedge funds aggressively liquidated holdings in the group recently, Kalivas said. In addition, a weak dollar provided some relief to commodity prices, as the euro currency surged 1.6% against the greenback, sparking a bounce in the Commodity Research Bureau Index, which jumped 1.4% to reverse steep recent declines. “Energy stocks are being helped by the fact that they were oversold. Moreover, there are worries about energy infrastructure right now, especially refining,” Kalivas said.

Crude oil prices rose just $0.31 a barrel today, closing U.S. trading at $101.18. The market was underpinned by concerns over Hurricane Ike, which is rapidly approaching the Texas Gulf Coast. There is some thought that the storm won’t wreak as much havoc on Gulf production as originally feared. However, gains in crude oil . . .

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