Stocks fall as lower oil weighs on commodities; technology stocks slide after rally

Stocks fall as commodity, tech stocks retreat

NEW YORK — The stock market’s rally is on hold and it’s not clear what might get it moving again.

Stock indicators barely budged this week after big gains in the prior week. A recent crop of better-than-expected economic news is becoming a bit stale after the Standard & Poor’s index surged 39 percent from a 12-year low in early March on growing hopes for an economic recovery.

Those kinds of gains might normally take years to occur, so it’s understandable that traders would become tired of hitting the “buy” button. Also, the market’s enthusiasm about the economy has been checked recently by unease about inflation and rising interest rates.

The bond market excercised unusual control over stocks this week as investors worried that the Treasury Department was running low on buyers for U.S. debt. While a successful bond auction Thursday eased some of those concerns, investors are still nervous that Washington might have to entice buyers with higher interest rates.

In addition to determining the government’s own borrowing costs, bond yields are also used as a benchmark for consumer loans and can influence how much people borrow to finance big purchases like homes. The 10-year Treasury note, which is closely tied to home mortgage rates, has risen to 3.81 from 3.71 percent in little more than a week.

Rising interest rates are worrisome because they could stomp out the economy’s attempts to recover from the recession, which began in December 2007.

With little to point them in either direction, stocks zigzagged in a tight range late in the day Friday as commodity and technology stocks gave up some of their recent gains.

Joe Clark, managing partner of Financial Enhancement Group, said investors have for now absorbed all the good news possible to push stocks higher.

“The sponge seems to be full,” he said.

In the last hour of trading, the Dow Jones industrial average rose 23.20, or 0.3 percent, to 8,794.12. The broader S&P 500 index rose 0.51, or 0.1 percent, to 945.40, and the Nasdaq composite index fell 8.32, or 0.5 percent, to 1,854.05.

A computer glitch briefly halted trading on the floor of the New York Stock Exchange for more than 200 stocks but has been resolved, the exchange said.

The disruption hit 242 stocks, including American Express Co., General Electric Co., Merck & Co. and Exxon Mobil Corp., but they continued to be traded electronically without disruption. About 3,100 stocks are traded at the NYSE.

Bond prices mostly rose Friday, pushing yields down. The yield on the 10-year Treasury note fell to 3.81 percent from 3.86 percent late Thursday.

The dollar rose against other major currencies, while gold prices fell.

Rick Bensignor, chief market strategist at Execution LLC, said the market likely would need big news such as a further stabilization in banks to push higher. Otherwise, some gains could come as portfolio managers worried about falling behind the major indexes are forced to buy in. But he expects the market will give back some of its gains because it has risen so far so fast.

“Bulls think this is nothing more than a resting stop,” he said. “Right now clearly the tug of war remains in place.”

About three stocks fell for every two that rose on the New York Stock Exchange, where volume came to 567.9 million shares, compared with 843.8 million traded at the same point Thursday.

The Russell 2000 index of smaller companies fell 0.67, or 0.1 percent, to 525.41.

Overseas, Japan’s Nikkei stock average rose 1.6 percent. Asian markets were buoyed by reports that retail sales and industrial output grew strongly in China in May.

Britain’s FTSE 100 fell 0.5 percent, Germany’s DAX index fell 0.7 percent, and France’s CAC-40 slid 0.3 percent.