Blue-Chip Rally Topples as Dow Snaps 10-Day Streak

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The Dow's longest winning streak since 1996 came to a close Friday with the blue chips falling from record highs after weak U.S. economic data shook traders' confidence.

Today's Markets

The Dow Jones Industrial Average fell 25 points, or 0.18%, to 14413, the S&P 500 dipped 2.5 points, or 0.16%, to 1561 and the Nasdaq Composite slumped 9.9 points, or 0.3%, to 3249.

The Dow failed to close at a record high for the first time in nine days Friday, while the S&P 500 skidded slightly further from its all-time peak logged in 2007. The move was driven by weak economic data, particularly a report on consumer sentiment that came in far below expectations.

The worst-performing sector by a wide margin was telecommunications, followed by consumer staples and discretionary. On the other side of the spectrum, utilities, often seen as a defensive segment, posted the best gains.

For the week, the Dow rose 0.81%, the S&P 500 climbed 0.62% and the Nasdaq advanced 0.15%.

Consumer Sentiment Data Disappoint 

Thomson Reuters/University of Michigan's preliminary reading on consumer sentiment dropped to 71.8  in early March from 77.6 in February, hitting the lowest level since December 2011. Economist had been expecting an increase to 78. The consumption sector is the biggest component of U.S. gross domestic product, so the data often have an outsize impact on the market. There have been concerns that high gasoline prices, coupled with the payroll tax hike that went into effect in January, would hurt retail sales.

The Labor Department said consumer prices climbed 0.7% in February from January as gasoline prices surged 9.1% in their biggest jump since June 2009. Excluding the more volatile food and energy components, so-called core prices increased 0.2%. Economists expected the headline number to increase 0.5% and the core to rise 0.2%.

The Federal Reserve's industrial production gauge ticked up 0.7% in February from January, topping expectations of a 0.4% increase. However, a separate report from the New York Federal Reserve showed the pace of the expansion in the regional manufacturing sector cooling slightly in March. The Empire State gauge fell to 9.24 from 10.04, compared to expectations of a shallower fall to 10.

Fed OKs Most Bank Capital Plans

After the closing bell Thursday, the Federal Reserve released its review of the capital plans submitted by the nation's largest banks. Most received a green light, with J.P. Morgan Chase (NYSE:JPM) and Goldman Sachs (NYSE:GS) receiving a conditional non-objection, and BB&T (NYSE:BBT) and Ally Financial getting rejections.

The release prompted a slew of news on dividends and share buybacks. Indeed, all four of America's biggest banks by assets, J.P. Morgan, Bank of America (NYSE:BAC), Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC), revealed share repurchase plans or said they would unveil details on buybacks later.

In commodities, oil prices rose 42 cents, or 0.45%, to $93.45 a barrel. Wholesale New York Harbor gasoline jumped 0.72% to $3.164 a gallon. Gold climbed $1.90, or 0.12%, to $1,593 a troy ounce.

On the European front, the European Council, which represents European Union heads of state, was meeting for the second day. Headlines from the meeting often impact European markets and the euro.

Foreign Markets

The Euro Stoxx 50 slumped 0.69% to 2726, the English FTSE 100 dipped 0.61% to 6490 and the German DAX fell 0.19% to 8043.

In Asia, the Japanese Nikkei 225 rallied 1.5% to 2727 and the Chinese Hang Seng edged lower by 0.38% to 22533.