US stocks end week on a low

Stocks extended their slide today, giving the tech-dominated Nasdaq composite index its worst weekly performance in 17 months.

Wall Street’s other major indexes had their largest weekly declines in several months.

Better-than-expected news about economic growth in the second quarter was overshadowed by a poor showing in consumer confidence and unease ahead of the third-quarter earnings season.

Stocks were also vulnerable to selling after an increase in prices since the spring.

The Dow Jones industrial average closed down 30.88, or 0.3%, to 9,313.08, after losing 81.55 on Thursday.

The Nasdaq composite index fell 25.17 or 1.4%, to 1,792.07 following a loss of 26.46 the previous session. The Standard & Poor’s 500 index declined 6.42, or 0.6%, to 996.85 after losing 6.11 yesterday.

The Nasdaq suffered a weekly loss of 6%, its biggest one-week decline in 17 months when the index shed 7.4%.

Analysts said tech stocks took the biggest fall this week because they had enjoyed the greatest gains in the rally that began in March.

The Dow ended the week down 3.4%, its largest weekly loss in six months.

For the week, the S&P 500 dropped 3.8%, its biggest percentage loss in eight months.

Stocks struggled to find direction today but slipped later in the day, continuing a trend from the previous two trading sessions.

Investors are questioning whether stocks have risen too high given lingering doubts about the economic recovery.

Those doubts were fanned on Wednesday by Opec’s announcement it would cut oil production. On Thursday, investors focused on a report showing a larger-than-expected drop in durable goods orders.

“We’re having a continuation of the consolidation that started five days ago,” said Alfred Goldman, chief market strategist at AG Edwards & Sons in St Louis.

“I think we’re handling the profit-taking in a very positive fashion,” Goldman said.

“We’re really just getting a moderate correction despite the magnitude of the previous rally.”

The latest news about the economy was good. In a report released before the start of trading, the government said the economy grew at annual rate of 3.3% in the second quarter, better than expected.

The increase, which beat analysts’ expectations, was revised upward from an earlier 3.1% estimate, and may signal that the country is poised for a sustained rebound from the recession that technically ended in late 2001.

Shannon Reid, a money manager with Evergreen Investments in Charlotte, North Carolina, said the market’s tone had been negative all week after finance ministers put pressure on Japan and China not to manipulate their currencies to their advantage.

“I think that gave a market that had already had a big run an excuse to have a breather,” Reid said.

“The bulls don’t feel it’s time to step in yet, so we haven’t seen much support.”

Declining issues outnumbered advancers 2 to 1 on the New York Stock Exchange, where volume was moderate. The Russell 2000 index, which tracks smaller company stocks, fell 9.78, or 2%, to 485.28.