Wall Street ended the week slightly lower Friday amid conflicting economic signals as traders and investors awaited a looming policy meeting of the Federal Reserve in the coming week. Stocks seesawed through the week to Friday in continued volatile trade as investors sought to read the latest economic tea leaves.
Multiple reports showed that the US economy was expanding, albeit at a lackluster second quarter pace of 1.9 percent, that home prices continued to fall, as did car sales, and that job losses continued to mount. While the latter reports appeared bleak on the surface, economists pointed out that July job cuts of 51,000 were not nearly as bad as feared. The Dow Jones Industrial Average of 30 blue chip shares fell 0.39 percent in the week to Friday, to end at 11,326.32, while the broad-market Standard & Poor's 500 index lost a more modest 0.20 percent to 1,260.31.
The technology-laden Nasdaq composite declined a scant 0.02 percent for the week to 2,310.96. "The dog days of summer settled onto Wall Street," said Al Goldman, a chief market strategist at Wachovia Securities, as trading wrapped up for the week.
"The major stock averages closed modestly lower on light volume. Readings on jobs, construction and manufacturing indicated tough times for the economy," he said. The Dow and other leading indexes have lost significant ground so far this year as a lingering housing slump, a credit crunch and soaring oil prices have weighed down the markets.
As Wall Street closed for business Friday, traders said they were turning their attention to next week's central bank meeting. The Fed is widely expected to keep its key interest rate firmly pegged at 2.0 percent at a meeting set for Tuesday. "The Fed will do nothing next week. Fed will keep fed funds at 2.0 percent, voice its concern about the longer term inflation threats from commodity prices," said John Lonski, the chief economist at Moody's Investor Service. Investors said they will also be keeping a close eye on crude oil prices which rocketed to record highs over 147 dollars a barrel last month. Prices have tumbled in recent weeks, but a key New York oil futures contract rose to 125.10 dollars Friday on renewed jitters over Iran's nuclear ambitions.
Washington has set the weekend as a deadline for major crude producer Iran to reply to an international offer of incentives for a freeze in its nuclear drive.
Traders said Wall Street sentiment was suppressed Friday as big US automakers reported gloomy sales and as auto giant General Motors announced a whopping 15.5-billion-dollar quarterly loss. Bond prices rose on the week as investors sought a safe haven from stocks. The yield on the 10-year Treasury bond declined to 3.948 percent from 4.111 percent a week earlier and that on the 30-year bond dropped to 4.569 percent from 4.696 percent.
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