Stocks dropped on Friday as the market focused more on news of an unexpected decline in a monthly consumer sentiment reading than on the surprising strength in the U.S. economy's growth rate in the second quarter.
The Dow Jones industrial average lost 30.88 points, or 0.33% to 9,313.08. The broader Standard & Poor's 500 index was off 6.41 points, or 0.64%, to 996.85. The Nasdaq composite fell 25.17 points, or 1.39%, to 1,792.07.
Among some of the industries leading the market down in Friday's session were textiles, photographic equipment, and oil and gas equipment. Drug retailers were one of the few bright spots.
After a dismal week for stocks, with declines of 3.4% for the Dow, 3.7% for the S&P 500, and 5.8% for the Nasdaq, traders began looking to next week, which will be fairly heavy on economic reports. One of the more eagerly anticipated releases will be the employment report, on Friday. Economic research unit MMS is expecting the U.S. unemployment rate to tick up to 6.2% from 6.1%.
Among other reports, consumer confidence figures for September will be released on Tuesday. On Wednesday, come reports on construction spending in August and jobless claims for the week ending Sept. 27. A report on U.S. factory orders is due out on Thursday.
A slew of companies will also be releasing earnings next week including Walgreen (WAG) on Monday, and Internet operating and development company CMGI (CMGI) and delivery company Dynamex (DDN) on Wednesday.
On Friday, the University of Michigan final September reading on consumer sentiment fell to 87.7, which was below forecasts of 88.5. The gauge had registered a higher 89.3 reading in August.
The report showed that "consumers are scared of joblessness," and suggests that consumer spending could slow after the current round of tax cuts pass through the system, according to Standard & Poor's MarketScope.
Somewhat offsetting the news was Commerce Dept. report that gross domestic product (GDP) grew at a revised 3.3% annual rate in the second quarter. Economic research firm MMS had been predicting the 3.1% rate reported earlier to remain unchanged.
In equities news, delivery delays may prevent wireless phone maker Motorola (MOT) from selling some of its first camera phones in the U.S. during the holiday season, the Wall Street Journal reported.
Biotech outfit Human Genome (HGSI) disclosed it will not develop its experimental anti-inflammatory drug for use by adults with chronic skin ulcers after the drug did not succeed in a mid-stage trial.
Mortgage finance company Freddie Mac (FRE) announced a two-month delay in restating earnings and said that it may have underreported earnings by a larger number than disclosed earlier.
On the plus side, chipmaker Intel (INTC) stock was upgraded by JP Morgan to "neutral" from "underweight."
Research In Motion (RIMM), which makes the BlackBerry handheld e-mail device, posted a second-quarter profit compared with a loss in the year-ago quarter. The company also raised its estimates for the second half of the year.
Divsersified conglomerate 3M (MMM) was upgraded by Banc of America Securities to "buy" from "neutral."
In New York Stock Exchange news, John Reed, the former Citigroup executives picked to reform the NYSE, is scrapping a board report on overhauling corporate governance at the exchange, the Wall Street Journal reported. The newspaper says the interim Big Board chairman is launching a sweeping review aimed at tougher changes. Lead director Carl McCall resigned from the board on Thursday.
Treasuries ended higher, thanks to mixed data revisions, quarter-end demand and concerns about a revival of dollar intervention, MMS says. The market remained unconvinced that employment would snap back vigorously next week, MMS says.
European stock markets ended mixed. London's Financial Times-Stock Exchange 100 index eased 45.10 points, or 1.07%, to 4,157.10 on profit taking.
In Paris, the CAC 40 was off 13.78 points, or 0.43%, to 3,216.76 as Alcatel and LVMH lost ground.
Germany's DAX index added eased 1.42 points, or 0.04%, at 3,324.85 as Schroeder government tries to push through some welfare reforms.
In Asia, Japan's Nikkei 225 index closed up 8.4 points, or 0.08%, at 10,318.44 after the market rebounded in late afternoon, and fresh buying from public pension money was rumored. In Hong Kong, the Hang Seng index added 3.63 points, or 0.03%, to finish at 11,290.15.