Dow Jones:12,595.75 (–100.17) S&P 500:1,337.77 (–10.88) Nasdaq:2,828.47 (–34.57)

US STOCKS ended a second week of losses on a down note yesterday, reflecting growing worries that stocks are on the precipice of a pullback.

Concern about slowed growth worldwide, the coming end of a supportive Federal Reserve policy and the fear of a worsening euro zone debt crisis are undermining the stock market’s ability to maintain an upward direction.

Financial stocks took the biggest hit, with the S&P Financial Index falling 1.5 per cent.

Recent heavy selling in commodities has prompted several money managers to forecast a pullback by stocks, noting that much of the stock market’s latest advance has been built on commodity-related stocks.

“I think this is the first thrust in what’s likely to be a correction in the stock market,” said James Dailey, a portfolio manager at TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

The Fed’s second round of quantitative easing has been credited for much of the strength in stocks and commodities since September 2010. The $600 billion bond-buying programme is set to end next month.

The Dow Jones industrial average ended down 100.17 points, or 0.79 per cent, at 12,595.75. The Standard Poor’s 500 Index was down 10.88 points, or 0.81 per cent, at 1,337.77. The Nasdaq Composite Index fell 34.57 points, or 1.21 per cent, at 2,828.47.

For the week, the Dow was down 0.3 per cent, the SP 500 was off 0.2 per cent and the Nasdaq barely up at 0.03 per cent.

The CBOE Volatility Index, used as an indicator of investor fear, ended up 6.5 per cent.

In another sign of a shift in sentiment, leadership in the S&P 500 has moved from cyclical sectors like energy and basic materials to sectors with more stable growth like healthcare and utilities.

The S&P energy index was down 1.4 per cent for the week, and down 8.3 per cent for the month to date.

Technology shares were also among the hardest hit in the session. Yahoo shares fell 3.6 per cent to $16.55 after the Internet company said the Alibaba Group restructured the ownership of Alipay, one of China’s largest online payment businesses, without the knowledge of Yahoo and Softbank, two of its stakeholders. – (Reuters)