Stocks Finish Week With a Thud
NEW YORK ( TheStreet) -- U.S. stocks finished a volatile week with a thud on Friday.
An underwhelming report on economic growth in China and the predictable return of eurozone worries drove the selling, which comes after two days of gains, including an especially strong bull run Thursday when all three major U.S. equity indices rose more than 1% and finished near the highs of the day.
Negative reactions to some high-profile earnings reports didn't help matters as financial bellwethers JPMorgan Chase (JPM) and Wells Fargo (WFC) both topped Wall Street's consensus profit view but saw their shares slump nearly 4%. Google's(GOOG) profit was above consensus as well but the company saw advertising pricing continue to weaken and was being criticized for a controversial two-for-one stock split plan.
The Dow Jones Industrial Average dropped 137 points, or 1%, to close at 12,849, just four points above the blue-chip index's low for the day. The S&P 500 fell 17 points, or 1.3%, to settle at 1370, led lower by banking sector losses after their strong run through the first quarter. Energy and materials were also among the biggest sector losers.
The Nasdaq lost 44 points, or 1.5%, at 3011, as heavyweight Apple (AAPL) lost 3% to $605.03. Shares of the iPhone and iPad maker have been among the market's best performers all year, rising more than 50%, but the stock underperformed the broad market this week, losing 4.5%, and retreating after hitting a new all-time peak of $644 on Tuesday.
For the week, the Dow fell 1.6%, the S&P 500 lost 2%, and the Nasdaq retreated 2.2%. Year-to-date, the indexes are still up 5.2%, 9.0%, and 15.6% respectively.
The VIX, Wall Street's investor fear index, jumped 14% to 19.53. A reading above 20 is considered an indication of heightening distress. The VIX measures implied volatility through options pricing for the S&P 500.
In the broad market, losers outpaced winners, 3 to 1 on the New York Stock Exchange and 4 to 1 on the Nasdaq.
Stocks soared Thursday as optimism about China and stimulus-friendly commentary from Federal Reserve officials revived the risk-on trade. Factor in Wednesday's move higher, and it was the Dow's best two-day performance on both a point and percentage basis since Dec. 21.
Instead of the whispered-about upside surprise though, China's first-quarter gross domestic product pulled back to 8.1%, its slowest pace of quarterly growth in more than three years, from 8.9% in the prior quarter. That was a big miss on the 9% figure traders were passing around Thursday and put a damper on hopes that the report would offset concerns over signs of a slowing U.S. economic recovery and the stresses in Europe.