U.S. Stocks Trim Losses Near Closing Bell
NEW YORK (MarketWatch) -- U.S. stocks on Friday flirted with gains heading into Friday's close, but still looked to be headed to strike its second week of losses so far this month, with financial and technology stocks fronting the decline as negative news hit both sectors.
has sparked a rebound in U.S. equity markets; According to CNBC, a bailout by banks of AMBAC could be announced as soon as Monday or Tuesday," said analysts at Action Economics.
After posting gains at the start and then losses the bulk of the session, the Dow Jones Industrial Average gained 36.23 points to 12,320.53, with the blue chips now geared towards a 0.2% weekly loss.
The reason behind all of this volatility is because the market is unsure of the longer-term direction of the U.S. economy," said Robert Pavlik, chief investment officer of Oaktree Asset Management.
Of the Dow's 30 components, 19 were trading higher.
The Dow's larger decliners include Intel Corp. , down 2.5%.
The S&P 500 gained 3.38 points to 1,345.91, a count that sets it up for a 0.3% drop from a week ago.
The technology-laden Nasdaq Composite declined 6.05 points to 2,293.73, positioning it for a weekly decline of 1.2%.
Helping pave the way down for tech stocks was Intuit Inc. , recently off 9.2%, after the software company reported a drop in quarterly profit Thursday. .
Financial follies
The fall for financials was helped along by Fannie Mae and Freddie Mac , both of which turned sharply lower, with Fannie Mac down 8.3% and Freddie Mac off 5.8%, after downgrades from neutral to sell by Merrill Lynch analysts. .
"We had to follow the negative news; it's the perfect storm of bad news for financials," said Art Hogan, chief market strategist at Jefferies & Co.
Trading volume on the New York Stock Exchange topped 1 billion, and declining stocks outran advancing issues more than 2 to 1, while more than 786 million shares exchanged hands on the Nasdaq, and decliners topped advancers nearly 3 to 1.
On Thursday, the major U.S. stock indexes fell more than 1% after data highlighting the slowing economy sank early optimism on the technology sector.
"I think the driver is going to be -- and has been for awhile -- the kind of yin and yang between inflation and recession," said Paul Nolte, director of investments at Hinsdale Associates. .
"There's a tug of war between folks that believe that we're at or near a bottom, and want to start to look through the first half to the second half, and price in earnings. Then there's a second group that doesn't believe in the 'E' in P-and-E levels, and believes every rally should be sold," said Hogan.
A slide in crude-oil prices helped in tilting energy stocks lower, with the Amex Oil Index down 0.4%, and the Amex Natural Gas Index also off 0.4%.
Heavy metal
In commodities trade on the New York Mercantile Exchange, crude oil prices shifted course, with April-dated light crude rising 58 cents, or 0.6%, to $98.81 a barrel. For the week, crude gained $3.31, after closing above $100 twice during the week. .
Elsewhere on the Nymex, gold futures closed with a modest loss, but soared more than $40 on the week, with gold for April delivery dropping $1.40 to end at $947.8 an ounce.. .
In the forex market, pressure continued against the greenback, with the dollar index at 75.54, down from 75.615 in late U.S. trading on Thursday. .
Overseas, European equities looked set to end with gains, as higher food and bank stocks offset weakness from auto makers and from Germany's second-largest utility, RWE. .
In Asia, most markets retreated, with Japanese stocks pushed down by exporters including Honda Motor Co. and Canon Inc. .
By Kate Gibson