U.S. Markets End Lower After Wild Week

October 17, 2008 6:18 p.m. EST

New York, NY (AHN) - All three major indices swung back and forth from positive to negative before finally settling the day lower. Friday was the end of a volatile week that saw the Dow make its best one day gain ever.

The Dow Jones Industrial average fell 127 points or 1.4 percent. Caterpillar, down 7.2 percent, weighed most on the average as investors are worried the company will report soft third quarter earnings due to high borrowing costs. Home Depot, 2.6 percent higher, was the Dow leader as comments that price cuts have helped boost sales rallied the stock.

The S&P 500 fell 6 points or 0.6 percent after experiencing its most volatile week ever. The index had surged 12 percent higher on Monday and then suffered its worst drop since the 1987 crash on Wednesday.

Tech held up best with the Nasdaq Composite losing a modest 6 points or 0.4 percent. Shares of Google, up 5.5 percent, provided some strength as their third quarter earnings report surprised to the upside, giving investors confidence to jump in.

Crude oil rebounded on Friday, moving $2 a barrel higher to settle at $71.85. News that OPEC moved their emergency meeting up to Oct. 24 help give the commodity a boost as many expect a production cut announced after the meeting.

On the economic front, housing starts in September fell 6.3 percent to an annual rate of 817,000 units, the lowest level since 1991. Subsequently, building permits fell 8.3 percent in September.

The Reuters/University of Michigan Sentiment index released it preliminary reading for October. The report showed a reading of 57.5, matching the low of the year in June, as consumer sentiment slid after seeing the worst week in the U.S markets since the great depression.

Economic data will be light next week, but corporate earnings reports will ramp up. American Express, Texas Instruments, SanDisk and Netflix are due to report Monday.