Updated from 4:05 p.m. EDT
Stocks in New York sank Friday as investors fretted about a stumble at search giant
and a wide earnings miss at industrial-equipment maker
Dow Jones Industrial Average
fell 149.33 points, or 1.07%, to 13,851.08. The
was down 18.98 points, or 1.22%, at 1534.10, and the
lost 32.44 points, or 1.19%, at 2687.60.
At its worst, the Dow fell more than 200 points.
The steep decline ensured that the major averages would finish the week with losses. Over the five sessions, the Dow slipped 0.4%, the S&P 500 slumped 1.2%, and the Nasdaq finished the week lower by 0.7%.
"We can't tell if the rally earlier this week was a breakout or a fake-out," said Paul Nolte, director of investments with Hinsdale Associates. "Despite hitting records, we're stuck in a trading range now. Any disappointment to this market will be an expensive one. However, when you look at the declines this week, they weren't much in the grand scheme of things."
About 3.66 billion shares changed hands on the
New York Stock Exchange
, and volume on the Nasdaq reached 2.37 billion shares. Losers outpaced advancers 3 to 1.
Weighing on the mood was Google, whose earnings shortfall after the last close stunned investors and analysts. Shares plummeted by $28.47, or 5.2%, to $520.12 in the wake of the numbers.
Another trouble spot was Cat, which reaffirmed its earnings and revenue forecast for the year, but reported that last quarter came in well shy of what had been anticipated. Despite keeping its outlook intact, Cat tumbled $3.78, or 4.4%, to $83.20 and was the biggest loser on the Dow.
The weakness came just a day after the market rode a wave of strong earnings to the upside, and both the Dow and the S&P 500 closed at record highs.
The Dow finished above 14,000 for the first time ever, tacking on 82.19 points, or 0.59%, to 14,000.41. The S&P advanced 6.91 points to 1553.08, and the Nasdaq surged 20.55 points to 2720.04, its best reading in more than six years.
Other earnings were positive, but they weren't able to offset the pressure from Google and Cat.
beat Wall Street's profit estimates, and
also got past expectations.
Citigroup slid 0.8% to $50.73, and Whirlpool dropped 5.3% to close $110.43. Schlumberger added 3.5% to $96.68.
Elsewhere, wireless-gear maker
had light numbers, while at
, fourth-quarter revenue jumped 13% from a year ago and earnings met analyst targets. Ericsson fell 5.4% to end the day at $39.84, and Microsoft lost 1.1% to $31.16.
"Obviously, there are quite a few disappointing earnings reports that
were holding us back," said Peter Cardillo, chief market economist with Avalon Partners. "Still, the earnings that have come out so far have been strong, and there have been no major surprises. The trend still looks good and, when it's all said and done, it should still be a positive earnings season."
In the absence of any economic data, Treasury prices rallied to their weakest levels in more than a month. The 10-year note rose 15/32 in price, yielding 4.96%, and the 30-year bond was higher by 21/32, yielding 5.06%.
Meanwhile, crude retreated yet remained stubbornly close to its all-time high. Oil prices shed 35 cents to close $75.57 a barrel, but finished with a gain of 2.2% for the week. Gasoline prices were off by 2.5 cents at $2.16 a gallon.
"In terms of inflationary pressures, oil is now near that limit," said Cardillo. "It could have a negative impact on the market if we get near $80 a barrel. Anything above that level could really spook the market, as higher energy and a falling dollar would be long-term negatives."
On the research front, UBS upgraded both
to buy from neutral. Still, Yum! closed down 16 cents, or 0.5%, to $34.13. Forest Labs was lower by $1.65, or 3.7%, to $42.98.
Among downgrades, JPMorgan cut video-game maker
to neutral from overweight, and Stifel Nicolaus reduced its rating for
to hold from buy.
Activision gave back 29 cents, or 1.6%, to $18.19. Hilton, which agreed to a $20 billion buyout by
earlier this month, slipped 24 cents, or 0.5%, to $44.91.
Overseas, markets were mixed. In Europe, Frankfurt's DAX decreased 1.5% and London's FTSE eased 0.8%. In Asia, Tokyo's Nikkei edged up 0.2%, and Hong Kong's Hang Seng was better by 1.2%.