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NEW YORK - US stocks fell on Friday as a drop in oil prices dragged down energy shares and strong consumer price inflation data dented hopes for an interest-rate cut any time soon.
All three major US stock indexes ended down for the week, which was dominated by
worries about a possible spread of the subprime mortgage market crisis into other economic sectors.
Major energy companies, including Exxon Mobil Corp., were among the top weights on the S&P 500 index.
Big investment banks also declined, despite strong results reported this week by Goldman Sachs Group Inc., Lehman Brothers Holdings Inc. and Bear Stearns Cos. Inc.
"The concern has shifted to the subprime lending market, it's in the news every day, all day. The trouble is people don't know how far the problems are going to extend," said Brian Gendreau, investment strategist at ING Investment Management in New York.
The Dow Jones industrial average fell 49.27 points, or 0.41 per cent, to end at 12,110.41. The Standard & Poor's 500 Index dropped 5.33 points, or 0.38 per cent, to 1,386.95. The Nasdaq Composite Index slipped 6.04 points, or 0.25 per cent, to 2,372.66.
For the week, the Dow dropped 1.4 per cent, the S&P 500 fell 1.1 per cent and the Nasdaq declined 0.6 per cent.
A government report showed overall February consumer prices rose faster than analysts estimated, while core CPI, which strips out volatile food and energy costs, matched forecasts. Analysts said the data added to views that the Federal Reserve would not be lowering interest rates soon.
Stock investors have been jittery over the inflation picture since a report Thursday showed higher-than-expected producer prices in February.
"When you come in with numbers like that, it's going to hurt the theory of a cut in rates," said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.
Citigroup shares were down 1.2 per cent, or 60 cents, at $49.53 on the NYSE and were the second-biggest drag on the S&P 500. Lehman Brothers' stock was down 2.5 per cent, or $1.84, at $71.19 on the NYSE. Bear Stearns was down 2 per cent, or $3.02, at $145.48.
Goldman shares fell 0.9 per cent, or $1.89, to $199.
Shares of Exxon declined 1.2 per cent, or 83 cents, to $69.86. US crude fell 44 cents to settle at $57.11 a barrel. It was the lowest level since late January for the April contract, which expires on Tuesday.
The shares of some subprime mortgage lenders perked up as several players received help that may keep them in business, but analysts said the gains may not be signs that the industry is out of the woods yet.
Accredited Home Lenders said it reached an agreement to sell $2.7 billion in loans at a big discount to ease pressure from margin calls. Accredited Home Lenders' shares shot up 15.6 per cent, or $1.47, to $10.90 on the Nasdaq.
Trading was heavy on the New York Stock Exchange, with about 2.08 billion shares changing hands, above last year's estimated daily average of 1.84 billion, while on Nasdaq, about 2.09 billion shares traded, above last year's daily average of 2.02 billion.
Declining stocks outnumbered advancing ones by a ratio of about 5 to 3 on the NYSE and by about 3 to 2 on Nasdaq.
- REUTERS