U.S. stocks drop sharply; Dow off 150 points

NEW YORK (MarketWatch) — U.S. stocks fell sharply on Friday, with the Dow Jones Industrial Average on track to halt its longest weekly winning streak since August of last year.

“We’ve seen another attempt at taking that 1,700 level and failed, which may have fueled some technical selling. Those that watch from a technical basis think that’s significant,” Art Hogan, market strategist at Lazard Capital Markets, said of the S&P 500, which on Friday had risen a couple of points to a high of 1,699.42.

However, “it’s difficult to attach a great deal of meaning to today’s action without volume, which is lackluster,” Hogan added.

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Positioned to halt a six-week winning stretch, its longest since one that ended Aug. 17, 2012, the Dow Jones Industrial Average DJIA -0.42% declined as many as 152 points, but was lately down 124.86 points, or 0.8%, at 15,373.46.

The S&P 500 index SPX -0.17% fell 8.73 points, or 0.5%, to 1,688.75, with telecommunications leading sector declines.

The index last Friday closed at a record 1,709.67, a day after finishing above 1,700 for the first time. It’s up 19% for the year.

“This week, we’re only setting records for our lack of volume,” said Hogan, who noted that Monday marked the lowest full-day volume in 12 months.

The Nasdaq Composite COMP +0.00% shed 13.70 points, or 0.4%, to 3,655.42.

For every five stocks rising, nine fell on the New York Stock Exchange, where 224 million shares traded by 11:45 a.m.

Composite volume hit 1.1 billion.

Wholesale inventories fell 0.2% in June, in line with estimates.

The dollar DXY +0.18% edged higher against other major currencies, while the yield on the 10-year Treasury note rose a basis point to 2.598%.

Crude prices CLU3 +2.11% gained $2.04, or 2%, to $105.44 a barrel and gold GCZ3 -0.05% rose $4.40, or 0.3%, to $1,314.30 an ounce.

Notable decliners included shares of Gap Inc. GPS -2.94% , down 4.1%, after the clothing retailer reported July sales at stores open at least a year climbed less than Wall Street expected.

J.C. Penney Co. shares JCP -6.75% dropped 7.4% after the department-store chain’s chairman voiced support for its CEO. Bill Ackman’s Pershing Square Capital Management LP, the company’s biggest shareholder, wants J.C. Penney to find a new chief executive.

Monster Beverage Corp. MNST +2.21% rose 2.4% after the energy-drinks distributor reported quarterly sales.

Shares of BlackBerry Ltd. BBRY +7.04% jumped 4.7% following a report that the smartphone maker is open to going private.

NRG Energy Inc. NRG -1.82% slipped 1.2% after it said second-quarter profit slumped 48% and lowered its guidance for 2013 adjusted earnings.

Priceline.com Inc. PCLN +4.98% shares jumped 4.9% a day after the online-travel business reported a 24% rise in second-quarter earnings, with sales growth driven by its hotel and rental-car businesses.

U.S. stocks on Thursday ended in positive territory for the first day this week, buoyed by stronger-than-expected Chinese trade data.

“We certainly came into a week we knew was wanting for catalysts. Last week we had a plethora of economic data and a preponderance of quarterly reports; this week we have neither,” said Hogan at Lazard.

“We’ve tried to make the stories fit the market action, and that’s a dangerous game, especially in low volume,” added Hogan.

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Kate Gibson is a reporter for MarketWatch, based in New York