NEW YORK - WALL Street finished its worst week of the year with a moderate decline on Friday as persistent unease over inflation and interest rates kept investors nervous about buying.
Stocks had appeared to steady themselves in morning trading on Friday following several days of heavy losses. But a jump in import prices and increased demand for foreign-made products renewed the market's inflation jitters and sent stocks sliding by midday.
Since the Federal Reserve said early last month that more rate hikes could be needed to counter inflation, investors have been increasingly unwilling to place bets and bid stocks higher. The Dow Jones Industrial Average shed more than 355 points this week and is off 6.5 per cent from a six-year high of 11,642.98, reached on May 10.
The Dow slid 46.90, or 0.43 per cent, to 10,891.92, after having been up 37 points earlier in the session. The Standard & Poor's 500 index fell 5.63, or 0.45 per cent, to 1,252.30, while the Nasdaq Composite Index lost 10.26, or 0.48 per cent, to 2,135.06. Analysts say Wall Street's pullback has been exacerbated by traders repositioning their holdings to account for the risk of rising interest rates and slowing economic growth.
But while stocks have slumped, investors were still unsure where to put their money. Despite the major indexes' retreat, advancing issues were just ahead of decliners on the New York Stock Exchange. NYSE preliminary consolidated volume of 2.31 billion shares trailed the 3.65 billion shares that changed hands on Thursday.
The major indexes finished with steep losses, saddled by concerns that rising interest rates would slow demand and hinder the global economy. For the week, the Dow dropped 3.16 per cent, the S&P 500 sank 2.79 per cent and the Nasdaq plunged 3.8 per cent.
Bonds prices drifted, with the yield on the 10-year Treasury note slipping to 4.98 per cent from 5 per cent on Thursday. Short-term yields continued lingering above long-term rates, signaling greater expectations of slowing economic growth. -- AP
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