After failing to sustain an initial upward move, stocks gave back ground over the course of the trading day on Friday, ending the session mixed. While easing concerns about the Greek debt crisis contributed to the early strength, traders seemed reluctant to buy stocks going into the weekend.
The major averages eventually ended the day on opposite sides of the unchanged line. While the Nasdaq fell 7.22 points or 0.3 percent to 2,616.48, the Dow rose 42.84 points or 0.4 percent to 12,004.36 and the S&P 500 climbed 3.86 points or 0.3 percent to 1,271.50.
With the mixed performance on the day, the major averages also closed mixed for the week. The Dow rose by 0.4 percent for the week and the S&P 500 edged up by less than a tenth of a percent, while the Nasdaq fell by 1 percent.
The modest gains by the Dow and the S&P 500 ended six-week losing streaks, while the Nasdaq fell for the fifth straight week and set a six-month closing low.
The early strength on Wall Street was partly due to reassuring comments from French President Nicolas Sarkozy and German Chancellor Angela Merkel regarding efforts to provide further financial assistance to Greece.
After a two-hour meeting in Berlin, Sarkozy and Merkel announced that they had reached an agreement under which Germany would drop its demand that private investors participate in a new Greek bailout package, indicating that the participation of private creditors would be voluntary.
Sarkozy called the agreement a "breakthrough" and noted that France and Germany want the new round of financial assistance to be worked out as quickly as possible.
However, a report from Reuters and the University of Michigan showing a notable deterioration in consumer sentiment in the month of June may have helped to offset some of the early buying interest.
Reuters and the U of M said that the preliminary reading on their consumer sentiment index came in at 71.8 in June, down from the final May reading of 74.3. Economists had been expecting the index to edge down to a reading of 74.0.
News that Moody's placed Italy's credit ratings on review for possible downgrade also contributed to some weakness among stocks. The reaction to the news reflected the continued concerns about the financial situation in Europe.
Additionally, some technology stocks came under pressure on the day, with wireless device maker Research in Motion (RIMM) leading the way lower after providing disappointing guidance. Shares of RIM fell by 21.5 percent to a nearly five-year closing low.
On the other hand, the Conference Board released a report showing a bigger than expected rebound by its U.S. leading economic indicators index in the month of May.
The Conference Board said its leading economic index rose by 0.8 percent in May following a revised 0.4 percent decrease in April. Economists had expected the index to edge up by 0.2 percent compared to the 0.3 percent drop originally reported for the previous month.
Sector News
While most of the major sectors showed only modest moves on the day, considerable strength was visible among airline stocks. The NYSE Arca Airline Index surged up by 2.1 percent, moving well off the nine-month closing low it set last Friday.
The strength in the airline sector came as a sharp drop by the price of crude oil eased concerns about fuel costs. Crude for July delivery fell $1.94 to $93.01 a barrel, a four-month closing low.
Railroad stocks also saw significant strength on the day, resulting in a 1.5 percent gain by the Dow Jones Railroads Index. The gain by the index came after it ended the previous session at its worst closing level in nearly two months.
Banking, real estate, and housing stocks also posted notable gains, while substantial weakness emerged among semiconductor stocks. The Philadelphia Semiconductor Index fell by 1.4 percent to a nearly seven-month closing low.
Electronic storage and biotechnology stocks also moved to the downside on the day, contributing to the modest loss posted by the Nasdaq.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region closed mostly lower on Friday. Japan's benchmark Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index ended the day down by 1.2 percent.
Meanwhile, the major European markets turned higher over the course of the trading day after seeing early weakness. The U.K.'s FTSE Index edged up by 0.3 percent, while the French CAC 40 Index and the German DAX Index both rose by 0.8 percent.
In the bond market, treasuries gave back some ground after showing a notable upward move over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, closed up by 3.5 basis points at 2.944 percent, bouncing off a six-month closing low.
Looking Ahead
While the economic calendar next week is relatively light, traders are likely to keep a close eye on the Federal Reserve's monetary policy announcement and Fed Chairman Ben Bernanke's accompanying press conference on Wednesday.
On the earnings front, Adobe Systems (ADBE), Walgreen (WAG), FedEx (FDX), Lennar (LEN), and Oracle (ORCL) are among the companies scheduled to release their quarterly results next week.
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May 08, 2026 15:50 ET Manufacturing and services sector survey results and labor market data from main economies were the highlight on the economics news front this week. Factory orders and jobs report dominated the news flow in the U.S. Similarly, industrial production data from German garnered attention in Europe. In Asia, purchasing managers’ survey results from China and the central bank decision from Australia were in focus.