NEW YORK: U.S. stocks fell, capping a rocky week when traders focused on the consequences of the coming U.K. vote on whether to stay in the European Union.
Traders described an uneasy calm in the stock market Friday following a string of losses. As of June 8, the S&P 500 had been up 3.7% for 2016. The index had pared those gains as of Friday’s close to be up 1.3% this year.
Also since June 8, oil prices have fallen back below $50 a barrel, and yields on the 10-year Treasury note on Thursday sank to their lowest close since August 2012.
Traders and analysts said they don’t expect much respite in the coming week.
“It feels like you’re on a boat, and you see the clouds coming,” said Mohit Bajaj, director of ETF trading solutions at broker WallachBeth Capital LLC.
On Friday, the Dow Jones Industrial Average fell 57.94 points, or 0.3%, to 17675.16, putting it 1.1% lower for the week. The S&P 500 slipped 6.77 points, or 0.3%, to 2071.22, leaving it down 1.2% for the week.
The Nasdaq Composite Index fell 44.58 points, or 0.9%, to 4800.34.
Over the past week, polls showing a tightening race in the British vote weighed on such risky assets as stocks and oil, while lifting prices of German government bonds and gold, as uncertainty about the outcome and its consequences for Europe rippled across global markets.
On Friday, oil prices rose as the dollar weakened. U.S.-traded crude oil was up 3.8%, to $47.98 a barrel, after six consecutive sessions of declines. For the week, oil lost 2.2%. Gold for June delivery retreated from its highest settlement since January 2015, falling 0.3%, to $1,292.50 a troy ounce.
In corporate news, Elizabeth Arden jumped $4.57, or 49%, to $13.88, after Revlon agreed to buy the cosmetics company.
In addition to worries about the U.K. vote, German bond yields this past week turned negative for the first time and the U.S. Federal Reserve lowered projections of how much it will raise short-term interest rates in coming years. The latter was a reversal from just a few weeks earlier, when Fed officials strongly hinted they might raise rates in June or July.
“This week has been one crosscurrent after another,” said Quincy Krosby, market strategist at Prudential Financial.
Many money managers said they were avoiding any big bets ahead of the U.K. vote, as it could go in either direction.
“At this point, people are going to stay where they are,” said Ryan Kelley, a portfolio manager at Hennessy Funds. “There’s not a whole lot of significant data between now and the vote next Thursday.”
The CBOE Volatility Index, or VIX, rose to a four-month intraday high of 22.89 Thursday, in a sign stock-market volatility will remain elevated.
“The last thing investors are willing to do is stick out their neck on geopolitical risks in a market they already feel is a bit long in the tooth,” said David Lafferty, chief market strategist at Natixis Global Asset Management.
