U.S stocks fall on mixed data, Fed uncertainty; Dow falls 0.70%


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Investing.com - U.S. stocks fell on Friday as mixed data prompted investors to avoid equities after a week of volatile sessions marked by uncertainty over the fate of Federal Reserve stimulus measures.

At the close of U.S. trading, the Dow Jones Industrial Average finished down 0.70%, the S&P 500 index ended down 0.59% as well, while the Nasdaq Composite index fell 0.63%.

A Bank of Japan decision earlier this week to leave monetary policy unchanged after months of rolling out stimulus measures has roiled markets in the past few days largely by fanning uncertainties as to whether the Federal Reserve will follow suit and scale backs stimulus measures.

Stimulus measures such as the Fed's monthly USD85 billion bond-buying program send stock prices rising by design to spur recovery, though talk of their dismantling has frayed nerves in recent sessions, sending stocks through peaks and valleys.

Mixed data released on Friday prompted investors to avoid equities until the Federal Reserve provides some indications as to when stimulus measures may begin to unwind.

The U.S. Bureau of Labor Statistics reported earlier that the U.S. producer price index rose 0.5% in May, beating expectations for a 0.1% rise after a 0.7% decline the previous month.

The core producer price index, which is stripped of the more volatile food and energy costs, rose 0.1% last month, in line with expectations, after a 0.1% gain in April.

However, the Federal Reserve reported earlier industrial production in the U.S. came in flat in May, missing expectations for a 0.2% rise though up from a 0.4% contraction the previous month.

Weaker-than-expected consumer sentiment data pushed stocks lower as well.

Thomson Reuters/University of Michigan's preliminary consumer sentiment index fell to 82.7 in June from 84.5 in May.

Analysts were expecting the reading to remain unchanged at 84.5.

Leading Dow Jones Industrial Average performers included Verizon Communications, up 0.87%, Merck, up 0.10%, and Home Depot, up 0.07%.

The Dow Jones Industrial Average's worst performers included American Express, down 2.98%, DuPont, down 2.25%, and JPMorgan Chase, down 1.94%.

European indices, meanwhile, finished higher.

After the close of European trade, the EURO STOXX 50 rose 0.21%, France's CAC 40 rose 0.19%, while Germany's DAX 30 finished up 0.40%. Meanwhile, in the U.K. the FTSE 100 finished up 0.06%.

The Federal Reserve will begin a two-day monetary policy meeting on Tuesday followed by a decision on interest rates and a press conference with Chairman Ben Bernanke on Wednesday.

Markets will be eager to see if the U.S. monetary authority will clarify policy uncertainty.

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This article appears in: Investing Forex and Currencies
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