Stocks Fall Into Puddle of Oil

"With prices collapsing the incentive not to buy a home is increasing by the week, and with inventory showing no sign of improvement prices will keep falling," wrote Ian Shepherdson, chief U.S. economist with High Frequency Economics. "Supply always rises in spring so the headline inventory numbers overdo the true position, but it is still bad."

Against that backdrop, homebuilder stocks ended a crushing week with another collective slide. D.R. Horton (DHI Quote), Centex (CTX Quote), Pulte Homes (PHM Quote) and Lennar (LEN Quote) all lost 2.2% or more. For the week, the stocks plunged at least 15.6% apiece.

The Philadelphia Housing Sector Index was down 2.1% for Friday.

On the corporate side in the new session, striking workers at American Axle (AXL Quote) -- the main parts supplier to automaker General Motors (GM Quote) -- voted to accept a new employment contract and return to work next week. The strike had lasted about three months and forced GM to idle several of its manufacturing plants.

Still, GM lost ground after the company said the strike is expected to bleed $1.8 billion out of pretax second-quarter earnings, having held back production on some 230,000 vehicles. Other work stoppages caused by finalizing local union agreements will spur a further $200 billion in pretax losses this quarter, said the company. Furthermore, GM expects "only a portion of this lost production will be recovered," considering the harsh economic environment and a market shift away from the sorts of vehicles the strike impacted.

GM shares lost 4.5%, making it the Dow's worst-performing component of the day, and American Axle gave up 4.2%.