Stocks snap three-week losing streak


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NEW YORK (CNNMoney) — U.S. stocks fell Friday, but ended higher for the week, as concerns about the debt crisis in Europe weighed on the market ahead of a long weekend.

Investors on both sides of the Atlantic are worried about Spanish banks and the failure of European leaders to come up with any good solutions, especially concerning Greece and its possibility of leaving the eurozone. According to CNNMoney’s Fear Greed Index, investor sentiment has been at an “extreme fear” level for the past two weeks.

But the negative tone was tempered by an index of U.S. consumer sentiment, which rose in May to its highest level in more than four years.

The Dow Jones industrial average (INDU) fell 75 points, or 0.6%, to end at 12,455. The SP 500 (SPX) lost 3 points, or 0.2%, to 1,318. The Nasdaq (COMP) fell 2 points, or 0.1%, to 2,837.

Despite the weakness on Friday, all three indexes posted gains for the week, snapping a three-week losing streak. The Dow gained 0.7%, the SP 500 rose 1.7% and the Nasdaq added 2.1%.

Signs that the Spanish banking crisis is worsening weighed on investors. Bankia, one of the largest banks in Spain, officially requested €19 billion in state aid, giving the government a majority stake. Investors were also rattled by a report that certain Spanish municipalities are struggling to raise money.

The euro remained under pressure at about $1.25. The currency is down 5% in the past month and analysts say it has further to fall.

Meanwhile, trading volumes were low ahead of a three-day weekend for U.S. markets, with many investors taking the day off or leaving early Friday.

Concerns about the European debt crisis and whether a Greek exit from the euro would spark a financial meltdown, as well as a global recession, have weighed on U.S. markets in recent weeks.

U.S. stocks finished mixed Thursday, as investors mulled lackluster economic data in the U.S. amid the ongoing concerns about Europe.

Given the market’s recent slide, many investors may soon be looking for buying opportunities. Tyler Vernon, chief investment officer at Biltmore Capital, noted Thursday that the SP 500 is trading at an attractive valuation — below 13 times earnings estimates.

Economy: The University of Michigan’s Consumer Sentiment Index for the month of May rose to 79.3 from 76.4 in April. The index was expected to come in at 77.5, according to a survey of analysts by It was the highest level since October 2007.

Companies: Facebook (FB) shares fell after gaining 3% on Thursday, as the company continues to deal with the fallout from its bungled IPO last week. The offering has prompted concern from regulators and lawsuits from investors who say they were denied access to privileged information ahead of the stock’s debut.

World markets: European stocks ended modestly higher. The DAX (DAX) in Germany and France’s CAC 40 (CAC40) both rose 0.4%, while Britain’s FTSE 100 (UKX) was little changed.

Asian markets ended mixed. The Shanghai Composite (SHCOMP) lost 0.7%, but the Hang Seng (HSI) in Hong Kong added 0.3% while Japan’s Nikkei (N225) gained 0.2%

Currencies and commodities: The dollar rose against the euro, the Japanese yen and the British pound.

Oil for July delivery rose 39 cents to $91.04 a barrel.

Gold futures for June delivery rose $7.80 to $1,565.30 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 1.75% from 1.76% late Thursday.  To top of page

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