Dow Sees Biggest Decline in Six Weeks as S&P 500 Fails to Extend Record Closes

Dow closes with biggest weekly decline in 6 weeks
The week for stocks looked so promising through Thursday, but Friday brought about a sour note, leaving stocks lower for the Dow than where it began for the week, and erasing record highs the S&P 500 had been achieving during the week. The Friday decline managed to thwart the chance for indexes to end at another week of record highs.

The S&P 500 index has squeezed out three record days in a row from Tuesday through Thursday, but investors found negatives in a number of areas on Friday that wiped out all the gains made during the week. The S&P 500 had been flirting with 2,000 all week, but failed to ultimately make it there. The index was down 9.6 points for the day (-0.48%) ending at 1,978.34 for the week, which was approximately where it had started for the week.

The Dow Jones Industrial Average saw its average dip below the key 17,000 mark once again as a series of disappointing earnings came in on Friday. The result was the largest weekly decline in a month and a half, leaving it down 123.23 points (-0.72%) for the day at 16,960.57. For the entire week, the Dow fell 0.8%, a decline it hadn’t seen since the middle of June.

The NASDAQ Composite closed 22.5 points lower on Friday (-0.50%) at 4,449.56. This actually was a small gain overall for the week of 0.4%, buy still far below the record high of over 5,000 achieved during the dotcom bubble.

Amazon set the tone for the day by disappointing investors by posting a second-quarter loss in excess of what investors had expected. The stock was down almost 10% for the day, and it was a big contributor in the S&P 500 failing to end the week at another record high. Visa was another disappointment on Friday, losing 3.8% of its value when it announced a smaller annual growth forecast.

One bright spot on the day was El Pollo Loco. On the first day of trading, the stock rose 60% in value to $24 a share, well above the $15 a share price of the initial public offering.

The week ahead offers a variety of economic news which will determine whether or not the markets can rebound from Friday and look to reach record highs again. The monthly jobs report will be released, and there could be news out of the Federal Open Market Committee meeting which could determine the direction stocks for the week.

(Photo courtesy of George Rex)

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3 Responses to Dow Sees Biggest Decline in Six Weeks as S&P 500 Fails to Extend Record Closes

  1. daniel says:

    It’s about time that people realized Amazon isn’t a good place to be investing money.

  2. I wonder why El Pollo Loco was looking so strong. I haven’t noticed anything significant happening with them which might boost them up.

  3. Curly4 says:

    There is a very big problem with the stock market now days. The problem is that the small investor has not the ability to trade like the large investors have there for cannot take advantage of the ups and downs that the large investors cause. The large investors (institutional) can cause the market to go up by buying and then drop by selling thus the small investor taken advantage of. The large and institutional investors are getting rich on the backs of the small.
    The other problem is the price of stocks is NOT based on earnings but on the loose money policies of the government. Let the government stop the buyback and the value of the stocks will drop dramatically. The large and institutional investors seem to have a heads up on when the government changes these policies and get out of the market before the market drops. The large investors gets gets out at the expense of small investors.

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