Stocks slipped on Friday as a session with sparse economic data gave investors little reason to push indexes higher, but the S&P 500 and Nasdaq remained on track for their eighth positive week in the last nine.
The S&P 500 has traded in a tight range in the past two weeks, mostly holding on to a gain of nearly 9 percent since the beginning of the year.
Even though both the Nasdaq and S&P were on track for their third straight weekly advance, gains were limited as economic data throughout the week cast some doubt on the strength of the economic recovery.
The news continues to be conflicted. That is why you see this market. We are not racing away any more. We are stuck right at these numbers, said Ken Polcari, managing director of ICAP Equities in New York.
You just have the markets in this holding pattern, biding their time. Everyone is trying to figure out what the answer is going to be.
Investors were keeping a close eye on oil prices, which have risen more than 15 percent since the start of February. U.S. crude oil futures fell 2.3 percent to under $107 a barrel a day after hitting a 10-month high above $110 on supply concerns in the Middle East.
A steep rise in crude and gasoline prices could cut into consumer spending and damage the economic recovery.
We've had a pretty big move since the end of the third quarter last year that has been driven by a variety of factors, but we are maybe at a point now where the market needs to digest some of the move that it has had, said Doug Foreman, director of equities at Kayne Anderson Rudnick in Los Angeles.
If we have some big event in the Middle East with Iran or what have you, then obviously, that could throw a monkey wrench into things in the short run.
The Dow Jones industrial average <.DJI> dropped 38.60 points, or 0.30 percent, to 12,941.70. The Standard & Poor's 500 Index <.SPX> lost 6.27 points, or 0.46 percent, to 1,367.82. The Nasdaq Composite Index <.IXIC> slipped 16.15 points, or 0.54 percent, to 2,972.82.
For the week, the Dow is off 0.3 percent, while the S&P 500 is up 0.2 percent and the Nasdaq is up 0.3 percent.
Aides to U.S. President Barack Obama and Israeli Prime Minister Benjamin Netanyahu are scrambling to bridge differences over what Washington fears could be an Israeli attack on Iran's nuclear sites, a concern at the heart of the recent spike in oil prices. Both leaders will meet on Monday.
The U.S. dollar's strength against the yen and the euro could continue to pressure oil and other commodity prices.
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(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)