Stocks slipped on Friday as data showed the U.S. economy grew less than expected in the fourth quarter, while some disappointing earnings added pressure to the market.
Government data showed U.S. gross domestic product expanded at its fastest pace in 1-1/2 years in the fourth quarter of 2011 but fell shy of expectations. A strong rebuilding of inventories and weak spending by businesses pointed to slower growth early this year, denting recent optimism about an improving economy.
But losses were curbed as Federal Reserve statements this week and economic data kept investors alert for the possibility of another round of monetary stimulus known as quantitative easing, or QE3.
Out of what the Fed said, you can expect some negative numbers because the Fed obviously saw what the GDP numbers are and they anticipate a slowdown, said Sean Kraus, chief investment officer at CitizensTrust in Pasadena, California.
If the Fed does resort to QE3 to stimulate growth, investors don't want to be caught flat-footed and be out of risky assets, Kraus said.
The Dow Jones industrial average <.DJI> dropped 60.06 points, or 0.47 percent, to 12,674.57. The Standard & Poor's 500 Index <.SPX> dipped 2.69 points, or 0.20 percent, to 1,315.74. The Nasdaq Composite Index <.IXIC> gained 7.46 points, or 0.27 percent, to 2,812.74.
Procter & Gamble Co
Ford Motor Co
Network equipment makers Juniper Networks Inc
According to Thomson Reuters data, 58.7 percent of 184 S&P 500 companies reporting earnings through Friday have topped analysts' estimates, below the beat rate of about 70 percent seen at this stage of earnings season in recent quarters.
Utilities moved lower after results from American Electric Power
Eastman Chemical Co
Euro zone finance officials voiced optimism a deal to avert a disorderly Greek default was imminent. Renewed concern about the crisis has troubled markets this week.
(Reporting By Chuck Mikolajczak; Editing by Kenneth Barry)