NEW YORK — Stocks dropped sharply in late trading Friday on Wall Street but still managed to end the month higher.
After moving between small losses and gains for most of the day, the stock market started to drift lower in afternoon trading. The sell-off accelerated in the final hour. The Dow Jones industrial average ended the day with its biggest loss in six weeks, falling more than 200 points.
Some traders said the sudden afternoon swoon was due to investors rebalancing their holdings at the end of the month. As stocks fell, bonds rallied. The yield on the 10-year Treasury note, which had risen as high as 2.20 percent during the day, fell back to 2.13 percent in late trading. Yield falls as bond prices rise.
On Friday, there was both encouraging and disappointing news on the economy.
Stock indexes started the day slightly lower after the government reported that Americans cut back on spending. Consumer spending fell 0.2 percent in April, the first decline since last May, the Commerce Department said early Friday.
That news was offset by a report released later showing that a measure of U.S. consumer confidence jumped to the highest level in almost six years in May, lifted by rising home prices and record-high stock prices.
The University of Michigan's consumer sentiment index rose to 84.5 in May, up from 76.4 in April and the highest since July 2007. Investors are hoping that increasingly confident consumers will step up their spending, which would contribute to U.S. economic growth.
The Dow closed down 208.96 points, or 1.4 percent, to 15,115.57.
It was the biggest loss for the index since April 15.
Copyright 2016, Deseret News Publishing Company