Stocks ended slightly lower Friday as the possibility of a Federal Reserve interest rate hike dampened sentiment. However, the Nasdaq recorded its eighth-straight weekly gain.
The Dow Jones industrial average dipped 0.2%, the S&P 500 lost 0.1% and the Nasdaq edged down a fraction. Volume was slightly higher on both the NYSE and the Nasdaq compared to Thursday, according to preliminary data.
San Francisco Federal Reserve Bank head John Williams said late Thursday that policymakers should consider a rate hike in September, adding that continued low rates could hurt the economy.
His comments came after New York Fed chief William Dudley made hawkish comments earlier in the week. Investors will look for further clues to Fed rate policy at next week's meeting of global central bankers in Jackson Hole, Wyo.
In the stock market today, U.S. Steel (X) led the S&P 500 lower, dropping more than 6% after KeyCorp downgraded the stock to underweight.
Analyst Philip Gibbs warned that the U.S. steel industry will suffer from slowing demand and rising imports in the coming months, according to TheStreet.com.
U.S. Steel sliced through its 50-day moving average and has erased much of a 47% gain past a 18.81 buy point of a cup-with-handle base.
Investors should consider taking profits when a stock rises more than 20% past its buy point, since many correct after reaching that level.
IBD'S TAKE: The 20% sell rule can help investors protect profits and limit the risk that a solid gain could evaporate.
Small-cap steel maker Olympic Steel (ZEUS) plunged 17% and AK Steel (AKS) dropped nearly 10%.
Retail and machinery stocks led on the upside after strong earnings reports from tractor maker Deere (DE) and Foot Locker (FL).
Deere soared 13% after reporting that profit for the latest quarter edged up 1% to $1.55 a share, the first increase in 10 quarters and much better than Wall Street analysts had expected. Sales fell 11% to $6.7 billion, just below views.
Foot Locker jumped 11% after the athletic apparel retailer reported a 12% increase in profit for the latest quarter to 94 cents a share, beating analysts' estimates. Sales rose 5% to $1.8 billion.
