Stocks Give Back Ground Amid Worries About Greece - U.S. Commentary

(RTTNews) - Stocks moved mostly lower over the course of the trading day on Friday, giving back some ground following the rally seen in the previous session. Selling pressure remained relatively subdued, however, limiting the downside for the markets.

The major averages ended the session near their worst levels of the day. The Dow slid 101.56 points or 0.6 percent to 18,014.28, the Nasdaq dipped 15.95 points or 0.3 percent to 5,117.00 and the S&P 500 fell 11.48 points or 0.5 percent to 2,109.76.

Despite the losses on the day, the major averages all moved higher for the week. While the Nasdaq jumped by 1.3 percent, the Dow and the S&P 500 advanced by 0.6 percent and 0.7 percent, respectively.

The weakness on Wall Street was partly due to profit taking following recent gains, which lifted the tech-heavy Nasdaq to new record highs on Thursday.

Concerns about the situation in Greece also weighed on the markets as the debt-laden country remains at an impasse with its international creditors.

A meeting of European finance ministers on Thursday did not make any significant progress, and eurozone leaders are set to hold an emergency summit on Monday to discuss the issue again.

Greece has indicated that it will be unable to make a 1.5 billion euro payment to the International Monetary Fund at the end of the month without further aid, leading to a default.

Capital Economics said, "The odds of Greece defaulting on its debt, and possibly exiting the euro-zone too, seem to be growing by the day."

Nonetheless, overall trading activity remained somewhat subdued as traders took a step back following the recent upward move.

A lack of major U.S. economic data also kept some traders on the sidelines ahead of the release of some key reports next week.

Among individual stocks, shares of Healthways (HWAY) fell sharply on the day after the wellness program provider cuts its full-year revenue guidance.

Candy maker Hershey (HSY) also moved lower after forecasting full-year earnings below analyst estimates. The company also announced plans to cut about 300 jobs.

Meanwhile, shares of KB Home (KBH) moved notably higher after the homebuilder reported second quarter earnings that came in above analyst estimates.

Sector News

Gold stocks showed a significant move to the downside over the course of the trading session, dragging the NYSE Arca Gold Bugs Index down by 2.2 percent.

The weakness among gold stocks came even though the price of gold for August edged down only $0.10 to $1,201.90 an ounce.

Considerable weakness was also visible among oil service stocks, which moved lower along with the price of crude oil. With crude for July delivery falling $0.84 to $59.61 a barrel, the Philadelphia Oil Service Index dropped by 1.6 percent.

Steel, software, and utilities stocks also came under pressure on the day, while most of the other major sectors showed more modest moves to the downside.

Meanwhile, airline stocks turned in a strong performance, driving the NYSE Arca Airline Index up by 1 percent. SkyWest (SKYW) and American Airlines (AAL) posted notable gains.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index advanced by 0.9 percent, while Hong Kong's Hang Seng Index rose by 0.3 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index fell by 0.5 percent, the U.K.'s FTSE 100 Index closed just above the unchanged line and the French CAC 40 Index edged up by 0.3 percent.

In the bond market, treasuries moved notably higher, more than offsetting the pullback seen on Thursday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, tumbled by 8.4 basis points to 2.267 percent.

Looking Ahead

Next week's trading may be impacted by any developments regarding Greece along with the release of key U.S. reports on durable goods orders, new and existing home sales, and personal income and spending.