Wall Street finished a dismal week with a mixed performance Friday as investors grappled with fears about insurers of distressed mortgage-backed...
NEW YORK — Wall Street finished a dismal week with a mixed performance Friday as investors grappled with fears about insurers of distressed mortgage-backed bonds and anxiety about the broader economy.
The Dow Jones industrial average dropped 64.87 to 12,182.13 — above its lows of the day, but well off its highs, too. The biggest losers among the 30 Dow companies were financial companies American Express and JPMorgan Chase.
Microsoft, one of the 30 Dow stocks, gained 44 cents Friday to close at $28.56 a share but was down 6.2 percent for the week. Boeing, also a Dow stock, fell 42 cents Friday to $79.33 and was off 3.7 percent for the week.
Broader stock indicators were mixed. The Standard & Poor’s 500 index fell 5.62 to 1,331.29, while the Nasdaq composite index rose 11.82 to 2,304.85.
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The technology-heavy Nasdaq fared better than the other indexes Friday thanks partly to Amazon.com, which authorized a $1 billion share-buyback program. The online retailer rose $2.59, or 3.7 percent, to $73.50.
The Dow finished the week down 4.4 percent, the S&P 500 ended the week down 4.6 percent, and the Nasdaq finished the week 4.5 percent lower.
The market has been shaken in recent weeks by uncertainty surrounding bond insurers and whether they’ll be able to handle huge losses in the value of mortgage-backed bonds. On Thursday, Moody’s Investors Service lowered its rating on the bond insurer Security Capital Assurance. Then at midday Friday, Fitch Ratings, another credit-rating agency, put a series of mortgage-backed securities insured by MBIA on negative watch.
“The bond insurers are really on people’s minds,” said Kim Caughey, equity-research analyst at Fort Pitt Capital Group. “This is a horribly complex issue.”
If the ratings agencies downgrade more bonds and bond insurers, the moves could hurt the banks that own the bonds — and “just drive the credit markets into a downward spiral,” Caughey said. “It’s things happening further upstream that’s making people nervous.”
Financial stocks fell due to heavy selling in the corporate bond and leveraged loan markets, and meanwhile, soaring commodities prices hit retailers, said Miller Tabak equity strategist Peter Boockvar.
Crude oil prices jumped $3.66 to $91.77 a barrel on the New York Mercantile Exchange on expectations of disruptions in Nigerian exports.