Uncertainty About Ukraine Leads To Lower Close On Wall Street - U.S. Commentary

(RTTNews) - While trading activity was relatively subdued throughout the session on Friday, stocks ended the choppy trading day modestly lower. The drop on the day extended the sharp pullback that was seen over the course of the previous session.

The major averages finished in the red, near their worst levels of the day. The Dow dipped 43.22 points or 0.3 percent to 16,065.67, the Nasdaq slid 15.02 points or 0.4 percent to 4,245.40 and the S&P 500 edged down 5.21 points or 0.3 percent to 1,841.13.

For the week, the major averages all posted notable losses. The Dow tumbled by 2.4 percent, while the Nasdaq and the S&P 500 dropped by 2.1 percent and 2 percent, respectively.

The modestly lower close on Wall Street partly reflected uncertainty about the situation in Ukraine, with the Crimea region preparing to hold a referendum Sunday on whether to secede and rejoin Russia.

The U.S. and other western nations have said they will not recognize the outcome of the referendum, citing the lack of adequate preparation and the intimidating presence of Russian troops.

U.S. Secretary of State John Kerry and Russian Foreign Minister Sergei Lavrov held a six-hour meeting in London to discuss the ongoing crisis in Ukraine.

Both Kerry and Lavrov described the talks as "constructive," but they were unable to reach an agreement to address the escalating tensions.

Meanwhile, traders largely shrugged off some U.S. economic data, including a report from the Labor Department showing an unexpected drop in producer prices in February.

The Labor Department said its producer price index for final demand edged down by 0.1 percent in February after rising by 0.2 percent in January. The modest decrease by the index came as a surprise to economists, who had expected prices to creep up by another 0.2 percent.

Reuters and the University of Michigan released a separate report showing an unexpected deterioration in consumer sentiment in March.

The report showed that the preliminary reading on the consumer sentiment index for March came in at 79.9 compared to the final February reading of 81.6. Economists had expected the index to inch up to a reading of 81.8.

Amna Asaf, an economist at Capital Economics, said most of the drop in consumer sentiment can be attributed to the unseasonably bad weather.

Sector News

Most of the major sectors showed only modest moves on the day, contributing to the lackluster performance by the broader markets.

While some weakness was visible among banking, computer hardware, and biotech stocks, tobacco, steel, and gold stocks moved to the upside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region came under pressure during trading on Friday. Japan's Nikkei 225 Index plummeted by 3.3 percent, while Hong Kong's Hang Seng Index slumped by 1 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index rose by 0.4 percent, the French CAC 40 Index fell by 0.8 percent and the U.K.'s FTSE 100 Index dropped by 0.4 percent.

In the bond market, treasuries showed a lack of direction for much of the session before closing roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped by less than a basis point to 2.645 percent.

Looking Ahead

Reaction to the aftermath of the Crimea referendum could impact trading early next week, although traders are likely to be focused on the Federal Reserve meeting on Wednesday.

A slew of U.S. economic data is also likely to attract attention, with reports on industrial production, consumer prices, housing starts, and existing home sales all scheduled to be released next week.

On the earnings front, Oracle (ORCL), Nike (NKE), and FedEx (FDX) are among the companies due to report their quarterly results next week.