NEW YORK -- U.S. stocks declined for a second day Friday, adding to Thursday's sell-off and giving the market its worst week in two years.
The Standard & Poor's 500 index lost 5.52 points, or 0.3 percent, to 1,925.15. The index fell 2.7 percent this week, its worst weekly performance since June 2012.
The Dow Jones industrial average fell 69.93 points, or 0.2 percent, to 16,493.37. That's on top of the 317-point drop the index had Thursday. The Nasdaq composite fell 17.13 points, or 0.4 percent, to 4,352.64.
Investors found little reason to move money into stocks, faced with the growing geopolitical concerns in Israel and Ukraine, as well as banking problems in Europe.
For the past two years investors have wanted to step in to buy any major fall in the stock market, traders said, causing any sell-off to be met the next day with modest buying. Traders said that the selling Friday, on top of what happened the day before, is not a good sign.
"The follow-through from [Thursday's market drop] is very telling," said Jonathan Corpina, a trader on the New York Stock Exchange with Meridian Equity Partners. "The end of this week could not come at a better time as the weekend might provide some stability."
Energy and financial stocks were among the biggest decliners. Chevron, the nation's second-largest oil and gas company behind Exxon Mobil, fell $1.34, or 1 percent, to $127.90. While Chevron's earnings were better than analysts had predicted, the company's oil and gas production fell in the quarter. Exxon also reported lower production when it released its results Thursday.
Banking stocks also fell. JPMorgan Chase, Bank of America, Morgan Stanley and Goldman Sachs all fell roughly 2 percent each.
On Friday, the International Swaps and Derivatives Association ruled that Argentina had officially defaulted on its bonds for the second time in 13 years, in what the ISDA calls a "credit event." In a "credit event," investors who own credit-default swaps, a type of insurance that protects against a bond issuer defaulting, are activated and the companies which wrote the policies must pay the investors who own them.
In Portugal, the struggling Banco Espirito Santo plunged 40 percent. The bank reported Wednesday a $4.7 billion net loss for the second quarter, and there were concerns it is insolvent.
The concerns over the Argentinian default and as well as with European banks were the biggest driver of Friday's market decline, said Jonathan Golub, chief U.S. market strategist at RBC Capital Markets.
"The market doesn't like anything that could potentially disrupt the credit markets," Golub said.
Adding to the uncertainty, investors had the violence in Israel and Gaza as well as Ukraine to worry about. A 72-hour ceasefire between Israel and Gaza collapsed early Friday. In Ukraine, violence between government and pro-Russian separatists escalated.
Ukraine's unrest as well as the concerns over Espirito Santo weighed heavily on European markets. Germany's DAX fell 2.1 percent, France's CAC 40 fell 1 percent, and the FTSE 100 index fell 0.8 percent.
As global stock prices declined, traders moved money into investments traditionally seen as having lower risk Friday, such as U.S. government bonds, gold and utility stocks.
Business on 08/02/2014
Print Headline: S&P 500 logs worst week in 2 years