Stocks fall in quiet end to rocky month
NEW YORK (AP) -- Given the wild trading of late, it was a calm close to the month.
After flitting between tiny gains and losses most of Friday, the stock market closed mostly lower, a peaceful end to the most volatile month in nearly two years.
“It’s a dull Friday,” said Gary Flam, a stock manager at Bel Air Investment Advisors. A bull market, he added, is “rarely a straight march up.”
The Standard & Poor’s 500 index ended its bumpy ride in June down 1.5 percent, the first monthly loss since October. Still, the index had its best first half of a year since 1998 – up 12.6 percent.
Investors still seem unsure how to react to recent statements by Federal Reserve officials about when the central bank might end its support for the economy.
Mixed economic news added to investors’ uncertainty Friday. An index of consumer confidence was almost unchanged, but a gauge of business activity in the Chicago area plunged.
“Investors don’t know what to make of the news,” said John Toohey, vice president of stock investments at USAA Investment Management. “I wouldn’t be surprised to see more ups and downs.”
The S&P 500 stock index closed down 6.92 points, or 0.4 percent, to 1,606.28. The Dow Jones industrial average fell 114.89 points, or 0.8 percent, to 14,909.60. The Nasdaq composite index rose 1.38 points, or 0.04 percent, to 3,403.25.
Stocks have jumped around in June. By contrast, the first five months of the year were mostly calm, marked by small but steady gains as investors bought on news of higher home prices, record corporate earnings and an improving jobs market.
By May 21, the S&P 500 had climbed to a record 1,669. Fed Chairman Ben Bernanke spoke the next day, and prices began gyrating.
Investors have long known that the central bank would eventually pull back from its bond purchases, which are designed to lower interest rates and get people to borrow and spend more. Last week, Bernanke got more specific about the timing.
He said the Fed could start purchasing fewer bonds later this year, and stop buying them completely by the middle of next year, if the economy continued to strengthen.