By Sue Chang, MarketWatch , Ryan Vlastelica
Financials retreat as 10-year Treasury yield ticks lower
U.S. stocks edged lower on Friday but managed to post moderate weekly gains with investors awaiting further catalysts before jumping back into the market.
The Dow Jones Industrial Average slid 19.93 points, or 0.1%, to close at 20,914.62, while the S&P 500 index shed 3.13 points, or 0.1%, to finish at 2,378.25. The Nasdaq Composite Index rose less than a quarter point to end at 5,901.
"We had the Fed meeting, the economic data continues to come in good, but we have a lot coming up in terms of Affordable Care Act, tax reform, [and] European elections. So investors are content to just sit tight. They know that if we see some meaningful policy change, the market will take off," said Karyn Cavanaugh, senior market strategist at Voya Financial.
For the week, the Dow rose fractionally while the S&P 500 climbed 0.2%. The tech-heavy Nasdaq Composite notched a weekly gain of 0.7%.
"The market is in a tight trading range and it's fairly quiet. That said, the 10-year yield ticked down...and the financials are down while utilities, a bond surrogate, is up," said Quincy Krosby, market strategist at Prudential Financial.
The 10-year Treasury yield closed at 2.5% on Friday ., locking in a weekly decline after falling in the wake of Wednesday's Federal Reserve policy meeting. The financial sector (>> Financial Select Sector SPDR (ETF)) dropped 1% with Goldman Sachs Group Inc. (>> Goldman Sachs Group Inc) down 1.7% and J.P. Morgan Chase & Co.(>> JPMorgan Chase & Co.) off 1.1%.
President Donald Trump concluded his first official meeting with German Chancellor Angela Merkel without any market-moving developments. Following the summit, Trump expressed confidence in the U.S.-German relationship and reiterated his desire for more equitable trade with the country while Merkel kept her comments neutral but stressed that the U.S. must keep its commitments. Germany is one of several countries Trump has accused of having an unfair trade advantage.
Meanwhile, finance ministers from industrialized and emerging-market economies are gathering in Germany for a G-20 meeting, the first for Treasury Secretary Steven Mnuchin. The finance chief is expected put pressure on other countries to boost the value of their currencies, given Trump's push for a weaker dollar, while the Trump administration's protectionist policies are also a focus.
"This is the first time that global leaders are interacting with the Trump administration on a large scale, and you have to expect the market will be quiet ahead of a major question mark like that," said Adam Sarhan, chief executive officer at 50 Park Investments.
"So far, Trump has gotten the benefit of the doubt from foreign leaders, so there's a high likelihood that we come out of this with a positive framework, but there's no question that we're in a period with lofty valuations and stretched positive sentiment," he said. "The cards are shaping up for a climatic run marked by panic buying, rather than panic selling, which is a sign you're in the late stage of a bull market," Sarhan said.
In the latest economic data, industrial production was flat in February, below expectations for a rise of 0.3%. Separately, the index of consumer sentiment rose to 97.6 in March from 96.3 in February, based on a preliminary reading by the University Michigan. This was slightly below the reading of 98 that had been expected.
The Conference Board said its leading economic index rose 0.6% in February--the third straight gain of that magnitude--to reach its highest level in more than a decade.
Trading on Friday was calm despite the so-called quadruple witching, as stock-index futures, stock-index options, stock options and individual stock futures all expire on the same day.
Stock movers: Shares of Adobe Systems Inc.(>> Adobe Systems Incorporated) jumped 3.8% after the software company late Thursday reported better-than-expected quarterly profit and sales .
High-end jeweler Tiffany & Co.(>> Tiffany & Co.) rose 2.7% after it reported better-than-expected earnings and gave an upbeat outlook.
Other markets:Asian stock markets closed higher , with the exception of Japan's Nikkei, ahead of the G-20 meeting while European stocks were also higher.
Crude oil was flat while gold settled slightly higher.
--Sara Sjolin contributed to this article.