Stocks suffer large losses for the week

US stocks recorded their biggest weekly loss since March on concern the slumping economy will crimp corporate profits. Microsoft Corp, AOL Time Warner Inc and Pfizer Inc led the decline.

Reports of falling consumer confidence and slowing economic growth helped drive the Standard & Poor's 500 Index 4.3 percent lower for the week, the most since March 16. The benchmark index snapped a four-day losing streak today, climbing 0.4 percent.

The NASDAQ Composite Index lost 5.8 percent this week while the Dow Jones Industrial Average declined 4.5 percent.

"The economy is in a great deal of trouble," said Frederick Sears, chief investment officer at Investors Capital Corp in Lynnfield, Massachusetts, which manages US$150 million. The Federal Reserve "has lowered rates seven times this year, and it's done nothing."

Sears said he recently bought shares of Rockwell Collins Inc, the avionics company spun off from Rockwell International Corp, because he believes defense spending will pick up under president George W. Bush.

On Friday, the NASDAQ rose 13.75, or 0.8 percent, to 1,805.43; the S&P 500 gained 4.55 to 1,133.58; and the Dow advanced 30.17, or 0.3 percent, to 9,949.75.

Some investors speculated that signs of a pickup in Chicago-area manufacturing this month may signal the economic slowdown may be losing momentum, lifting shares of General Electric Co, AOL Time Warner and Intel Corp on Friday.

"You've had a pretty negative week, so a few bits of positive news today moved us higher," said John Bartlett, director of economic and market strategy for Commerce Trust Co, which manages US$10 billion.

Four stocks rose for every three that fell on the New York Stock Exchange, while five advanced for every four that declined on the NASDAQ Stock Market.

Some 908 million shares traded on the Big Board, 16 percent below the three-month daily average, as some investors refrained from taking new positions in stocks before the Labor Day holiday weekend. US exchanges are closed tomorrow.

Several economic reports sent stocks lower earlier this week.

Yesterday, a report showed that consumer spending, which has buoyed the economy this year, rose less than expected in July.

That boosted concern that corporate profits won't rebound soon and that the economy may slip into recession.

Stocks dropped Wednesday after a report that economic growth slowed in the second quarter, and on Tuesday after a report from the Conference Board showed falling consumer confidence.

Among the leading decliners for the week, Microsoft fell 8 percent even as it gained US$0.11 to US$57.05. AOL Time Warner lost 11 percent for the week and climbed US$1.35 to US$37.35. Pfizer declined 7.3 percent this week while advancing US$0.01 to US$38.31.

General Electric, the largest company by market value, gained US$0.78 to US$40.98; and Intel, the biggest chipmaker, advanced US$0.83 to US$27.96.

Raytheon Co advanced US$0.26 to US$26.29. The defense contractor said it won a US$212.6 million contract from the US Navy to produce missiles that protect ships from attacks. Raytheon will build 255 Evolved SeaSparrow Missiles for the Navy over the next three years.

Corinthian Colleges Inc fell US$13.50, or 26 percent, to US$39.35. The college operator forecast fiscal first-quarter earnings at the low end of analysts' estimates.

Novellus Systems Inc dropped US$2.42 to US$44.31. The company, whose equipment builds circuits in computer chips, said third-quarter orders will meet the low end of its forecast.