New York – U.S. stocks closed lower on the day and week Friday, dented by a rise in crude futures, remarks by Federal Reserve officials leaving open the possibility of more rate hikes and concern by Micron Technology executives about memory-chip demand and pricing.
These worries overshadowed new upgrades of Ford Motor Co. and General Motors Corp.
The Dow Jones industrial average closed down 56.80 points at 12,580.83, with GM one of the few Dow components posting strong gains.
The S&P 500 ended down 10.25 points at 1,438.06 as the Nasdaq Composite slipped almost 28.85 points to 2,459.82.
For the week, the Dow and the Nasdaq Composite lost 0.6 percent of their value and the S&P 500 gave up 0.7 percent.
There were 1.637 billion shares traded on the New York Stock Exchange, with losers outnumbering winners 22 to 9. About 2.2 billion shares traded on the Nasdaq market, with roughly two stocks trading lower for every one on the rise.
In energy, crude-oil futures earlier traded over $60 a barrel, after piercing that level overnight for the first time in five weeks, as traders weighed news of a problem at a California oil field against continued high supplies of oil and petroleum products.
Crude for March delivery closed up 18 cents at $59.89 a barrel on the New York Mercantile Exchange and took a 1.5 percent gain on the week.
Stocks opened higher Friday but turned lower around midday. Losses later intensified as investors absorbed the Micron news and the remarks by the Fed officials.
“First you had Micron talking about demand problems with NAND flash memory chips,” said Steve Goldman, chief market strategist at Weeden & Co. “The selling spilled over into the rest of the technology sector and then into the whole market.
William Poole, president of the Federal Reserve Bank of St. Louis, estimated that growth in U.S. gross domestic product this year will run at about a 3 percent clip. Poole also said he hopes core inflation will settle below 2 percent – but said the Fed is prepared to take action if inflation is not contained.
Poole’s remarks left investors unsettled, sending Treasuries lower and likely placing limits on the stock market’s potential gains, according to Charles Campbell, senior trader at Miller Tabak.
Poole’s remarks “put a lid on how high we can go,” Campbell said.
In addition, Cleveland Fed chief Sandra Pianalto said inflation statistics show improvement, but a firmer policy may be needed. She left open the possibility of further rate increases.
Dallas Fed chief Richard Fisher said he was pleased with the current direction of inflation. He also declined to rule out more rate increases.
