Updated from 4:09 p.m. EDTStocks fell Friday -- with the Dow closing below 9000 for the first time since June 9 -- as investors took some money off the table amid light volume and a dearth of any market-moving news. The Dow Jones Industrial Average ended down 90 points, or almost 1%, at 8989 while the Nasdaq fell 9 points, or 0.5%, at 1625. The S&P 500 finished with a loss of 9 points, or 0.9%, at 976. All three major averages ended lower for the week. "The news this week has actually been pretty mediocre," said Ed Peters, chief investment strategist at PanAgora Asset Management. "There hasn't been a lot of incentive for people to want to increase their holdings over the weekend." Peters said the market sold off Friday afternoon more because of a lack of buyers than an abundance of sellers. "This is what sometimes happens when you have light volume," he said. Volume on the New York Stock Exchange reached 1.2 billion shares, with losers beating winners by 17 to 15. On the Nasdaq, 1.5 billion shares changed hands with decliners outpacing advancers by 17 to 14. Stocks had been higher earlier although stuck in a tight trading range as investors digested the latest economic data. The University of Michigan consumer sentiment index fell to 89.7 in June from 92.1 in May, as concerns about slow job growth persisted. Still, the final reading was better than the 87.7 level that economists had been looking for. Meanwhile, personal spending rose a slightly-less-than-expected 0.1% in May while personal income climbed 0.3%, in line with economists' estimates. Next week brings a raft of economic data, including the employment report and ISM index for June, and some traders said investors were treading carefully ahead of that news and ahead of any possible preannouncements over the next week or two. After a strong start, Microsoft ( MSFT) retreated and was recently down 0.3%, or 9 cents, at $25.63 after an analyst at CSFB raised the stock's target price to $29 from $27 on expectations the company's upcoming earnings won't disappoint. Although the firm still believes the stock will continue to underperform in the short run, it cited upside potential based on valuation.
AOL Time Warner ( AOL) was also slightly lower, falling 0.4%, or 6 cents, at $15.82 even though Morgan Stanley raised its price target on the stock to $19 from $17, and upgraded its rating to overweight. The brokerage expects stronger performance in the company's entertainment business, and reduced leverage with the help of asset sales and free cash flow. Dow component General Motors ( GM) rose 0.5%, or 17 cents, at $36.11 after saying that its finance unit GMAC completed a record $17.6 billion bond sale on Thursday to help fund a shortfall in the company's pension fund. American Express ( AXP) climbed 0.4%, or 17 cents, at $42.42 after Bear Stearns raised its second-quarter and full-year earnings estimates on the stock. Drug stocks fell after the two chambers of Congress approved a big Medicare package that was supported by the Bush administration. A compromise measure would likely give seniors prescription-drug coverage for monthly premiums, a deductible and co-payments. GlaxoSmithKline ( GSK), Pfizer ( PFE) and Eli Lilly ( LLY) all drifted lower. In earnings news, Nike ( NKE) reported a 19% rise in quarterly earnings, but they still fell a penny short of estimates. The company said weak domestic demand was offset by stronger sales overseas, helped by a weaker dollar. Nike also said orders for sports apparel for delivery between June and November had a 10% decline, more than the 1% to 4% analysts were projecting. Shares fell 6.7%, or $3.85, at $53.08. Nextel ( NXTL) shares rose 1.6%, or 29 cents, at $18.49 after the wireless firm predicted it will meet earnings and sales forecasts for 2003.
Also among preannouncements, Medicis Pharmaceutical ( MRX) said it will miss earnings estimates for the fiscal year starting July 1. Biotech giant Genentech ( DNA) got so-called "fast-track" review for its cancer treatment Avastin from the FDA. The status lets the agency evaluate data as they become available in trials rather than having to wait for their conclusion. Shares of the company were trading 1.2% higher, or 85 cents, at $73.60. New York Community Bancorp ( NYB) agreed to acquire Roslyn Bancorp in a stock swap valued at about $1.58 billion. New York Community rose 7%, or $1.98, at $29.08. Treasuries rose after a volatile session, with the yield on the 10-year note falling to 3.54%. Crude oil prices were higher in New York. The dollar rose against the Japanese yen and fell against the euro. Overseas markets were mixed, with London's FTSE 100 up 0.6% at 4067 and Germany's Xetra DAX down 0.5% at 3224. In Asia, Japan's Nikkei closed 2% higher at 9104, while Hong Kong's Hang Seng gained 0.5% to 9657. Stocks had a strong session Thursday. The Dow Jones Industrial Average rose 0.8% to 9079. The S&P 500 jumped 1.1% to 985, while the Nasdaq Composite climbed almost 2% to 1634.