Wall Street posts 1st weekly loss since mid-April on Fed angst

May 25 2013, 04:15 IST
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US Stocks US Stocks
SummaryDow Jones industrial average gained 8.60 points, or 0.06 percent, to 15,303.10 at the close

The S&P 500 declined for a third day on Friday, with the three major U.S. stock indexes posting their first negative week since mid-April on lingering concern that the U.S. central bank may scale back its stimulus measures to support the economy.

Still, the indexes closed well off their lows in light volume ahead of the three-day Memorial Day holiday weekend.

The Dow ended slightly higher, outperforming the broader market, buoyed by a 4 percent gain in Procter & Gamble.

A jump in April orders for long-lasting manufactured goods, such as refrigerators and toasters, showed that the U.S. economy may be stronger than some had thought.

"A day like today is clear evidence that there is still money on the sideline to get into equities, (and investors are) looking for almost any excuse to get in," said Tim Ghriskey, chief investment officer of Solaris Asset Mangment in Bedford Hills, New York.

"This has been happening all week. Investors are taking advantage of down days to put more cash to work, especially when the decline is not based on something fundamental."

Trading has been choppy in the second half of the week as market participants assess the Federal Reserve's evolving stance toward markets. The Fed's stimulus measures have been instrumental in a rally that has driven U.S. stocks to record highs this year.

Even as there is some fear that the Fed will exit too soon, many analysts say the eventual tapering of the central bank's stimulus will come with an expansion of the economy and corporate earnings, which will continue to support equities.

Joe Bell, a senior equity analyst at Schaeffer's Investment Research in Cincinnati, said many people had been giving only "the Fed credit for this rally" and had "not been talking about some of the improvement in the labor market or housing data.

"The economy in general has been on a lot better footing than perhaps people have given it credit for," Bell said.

The Dow Jones industrial average gained 8.60 points, or 0.06 percent, to 15,303.10 at the close. The Standard & Poor's 500 Index edged down only 0.91 of a point, or 0.06 percent, to finish at 1,649.60. The Nasdaq Composite Index dipped 0.27 of a point, or 0.01 percent, to close at 3,459.14.

For the week, the Dow fell 0.3 percent, while the S&P 500 and the Nasdaq each dropped 1.1 percent. The S&P 500 had traded below its 14-day moving average - 1,647.91 - during

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