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U.S. stocks slip from near records as banks, energy shares fall

NEW YORK -- U.S. stocks declined Friday, after the Standard & Poor's 500 index traded near a record, as energy shares slumped with oil and financial companies fell from a seven-year high.

Banks in the benchmark index posted their steepest drop in two months. Marathon Oil and Schlumberger lost more than 2.2 percent. Hershey fell to a 10-month low after cutting its annual profit forecast. ConAgra Foods rallied to a record after activist investor Jana Partners disclosed a new stake.

The S&P 500 index fell 0.5 percent to 2,109.99 at the close in New York, after earlier coming within 0.5 percent of an all- time high. The Dow Jones industrial average lost 99.89 points, or 0.6 percent, to 18,015.95. The

Nasdaq composite index declined 0.3 percent from a record. Selling accelerated in the final minutes of trading as some stock and index futures and options expired in a process known as quadruple witching.

"The simple answer is because we were up yesterday," said Tom Wirth, senior investment officer for Chemung Canal Trust Co., which manages $1.9 billion in Elmira, N.Y. "It's quadruple witching day today. People are closing out positions and that can add to volatility in the market."

The S&P 500 dropped after its strongest three-day run in three months. It's the best performing developed-market index in June, and the only benchmark heading for a gain. Three rounds of Federal Reserve bond purchases and borrowing costs near zero have propelled the gauge up by more than 200 percent during the six-year bull market.

Equities were boosted this week as the Fed signaled that it won't be raising rates quickly, with officials still holding out for more decisive evidence of a rebound in growth. Fed Chair Janet Yellen stressed that the central bank has no set course for raising rates, and will continue to evaluate incoming data to decide when to move.

Fed Bank of San Francisco President John Williams said Friday the central bank is likely to raise interest rates this year as the economy reaches full employment, though he's troubled by low inflation.

Meanwhile, the breakdown in Greece's talks with creditors was a non-event for U.S. equity investors, with the S&P 500 up 0.8 percent this week. Traders are losing interest even as European finance officials called for an emergency meeting on Monday to resolve the Greek impasse before its financial lifeline expires at month's end.

"Right now, we're just immune to Greece," said Yousef Abbasi, the global market strategist at JonesTrading Institutional Services in New York. "Europe seems to think the Greece situation is under control and if something does happen, it won't cause contagion."

The Chicago Board Options Exchange Volatility Index climbed 5.8 percent Friday to 13.96. The gauge rose 1.3 percent for the week. About 8.1 billion shares traded hands on U.S. exchanges Friday, 29 percent above the three-month average.

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