Stocks slid Friday when waning enthusiasm among investors ahead of the holiday weekend overshadowed data showing higher consumer spending and a jump in sales of big-ticket goods in November.
NEW YORK (AP) — Stocks slid Friday when waning enthusiasm among investors ahead of the holiday weekend overshadowed data showing higher consumer spending and a jump in sales of big-ticket goods in November. A weak bond market also weighed on stocks.
The pair of reports from the Commerce Department was welcome news for the economy. Coupled with a final push of takeover activity in the past few weeks, it showed resolute consumer and corporate confidence, even with questions about how much the economy is slowing.
The Federal Reserve is attempting to orchestrate a soft landing for the economy, reining it in while not interrupting corporate growth. Wall Street is trying to peg the Fed’s next move after it left rates unchanged for the past four meetings.
Extremely light volume ahead of the Christmas holiday left the market prone to swings, however.
“Looking at the tape, you’re going to see stocks just wallow around because of lack of interest,” said John O’Donoghue, co-head of equities for Cowen & Co. “It is before Christmas, and it will be a very light day in the marketplace where most of the participants are going to be out early, and next week will be light as well.”
According to preliminary calculations, the Dow Jones industrial average fell 78.03, or 0.63 percent, to 12,343.22. Blue chips are backing off record levels seen earlier this week.
Broader stock indicators also dipped. The Standard & Poor’s 500 index was down 7.53, or 0.53 percent, at 1,410.77, and the Nasdaq composite index fell 14.67, or 0.61 percent, to 2,401.18.
Speculation that a weaker housing market and a slowing economy would give the Fed more leeway to cut interest rates next year caused bonds to fall. The yield on the benchmark 10-year Treasury note rose to 4.59 percent from 4.55 percent late Thursday, while the 30-year bond rose to 4.76 percent from 4.70 percent on Thursday.
The dollar was mostly higher against other major currencies, while gold prices edged higher. A barrel of light sweet crude fell 25 cents to $62.41 on the New York Mercantile Exchange.
Traders focused on the technology sector after positive earnings reports from Research in Motion Ltd., Red Hat Inc., and Micron Technology Inc.
Blackberry maker Research in Motion reported third-quarter profit that surpassed Wall Street projections, pushed higher by sales of new products. Shares fell $3.70, or 2.8 percent, to $130.
Micron Technology rose 45 cents, or 3.3 percent, to $13.94 after the chip maker reported that quarter profit tripled.
Red Hat surged $4.50, or 25.1 percent, to $22.46. The maker of computer operating systems reported third-quarter earnings that exceeded analysts’ expectations, and was able to deflect competition from Oracle Corp.
Rupert Murdoch’s News Corp. will swap its controlling stake in the satellite TV broadcaster DirecTV Group Inc. with Liberty Media Corp. in exchange for Liberty’s 16 percent stake in News Corp. News Corp fell 12 cents to $22.40, while Liberty Media added $4.23, or 4.5 percent, to $97.87.
The Russell 2000 index of smaller companies was down 2.08, or 0.27 percent, to 780.82.
Advancing issues barely outnumbered decliners on the New York Stock Exchange, where volume came to 986.5 million shares.
Overseas, Japan’s Nikkei stock average closed up 0.34 percent. At the close, Britain’s FTSE 100 was up 0.10 percent, Germany’s DAX index fell 1.08 percent, and France’s CAC-40 was shed 1.02 percent.