Reports on manufacturing, housing weigh on stocks

NEW YORK — Stocks have ended lower for a third day as discouraging reports on manufacturing and home sales further dampen enthusiasm about the state of the economy.

Investors are disappointed Friday that durable goods orders fell 2.4 percent in August despite hopes for an increase.

The government also says new home sales inched up last month but fell short of economists expectations.

According to preliminary calculations, the Dow Jones industrial average is down 41 points at 9,667. The Standard & Poor’s 500 is down 6 at 1,445. The Nasdaq composite is off 17 at 2,091.

Four stocks fell for every three that rose on the New York Stock Exchange. Volume came to 1.2 billion shares compared with 1.4 billion Thursday.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

NEW YORK (AP) — Stocks fell for a third day Friday after disappointing reports on manufacturing and home sales further dampened enthusiasm about the state of the economy.

Durable goods orders, a key indicator for the manufacturing industry, fell unexpectedly in August. It was the second drop in three months and the latest sign that any rebound inside the nation’s factories is likely to be slow.

The Commerce Department said orders for goods expected to last at least three years fell 2.4 percent, after rising 4.8 percent in July. Economists polled by Thomson Reuters had forecast an increase of 0.5 percent.

Meanwhile, the Commerce Department also reported that new home sales inched up to 429,000 last month from 426,000 in July. Economists surveyed by Thomson Reuters had expected a pace of 440,000.

Quarterly results from BlackBerry maker Research In Motion Ltd. fell short of expectations and weighed on the tech-laden Nasdaq composite index.

Traders are also watching a meeting of leaders from the world’s 20 largest economies in Pittsburgh for indications of how those governments plan to bring about a strong, sustainable recovery.

Stocks fell Thursday following a weaker-than-expected report on existing home sales and drops in commodities prices, which hurt materials and industrial stocks. The market also slid Wednesday on worries that the Federal Reserve would be too quick to withdraw its financial supports from the economy.

With major indicators like the Standard & Poor’s 500 index up 55.3 percent from a 12-year low in March, market analysts have been saying that a break in the advance is necessary.

“We had a market that got considerably overbought,” said Steven Goldman, chief market strategist, Weeden & Co. in Greenwich, Conn. “We still think things should stay relatively orderly in the pullback and we’re still likely to see further gains.”

In late afternoon trading, the Dow Jones industrial average fell 11.87, or 0.1 percent, to 9,695.57.

The broader Standard & Poor’s 500 index fell 2.79, or 0.3 percent, to 1,047.99, and the Nasdaq fell 11.19, or 0.5 percent, to 2,096.42.

Eight stocks fell for every seven that rose on the New York Stock Exchange, where volume came to 811.2 million shares compared with 981 million shares traded at the same point Thursday.

Investors looked past an improvement in the Reuters/University of Michigan consumer sentiment index, which rose to 73.5 in September from 65.7 in August. The index stands at the highest level since the start of 2008. That’s a welcome sign because more upbeat consumers could be more likely to spend. That could help the economy recover.

Some investors might look to the market’s occasional retreats as opportunities to boost their holdings.

Burt White, chief investment officer at LPL Financial in Boston, contends investors who are parked in safe investments like government bonds and upset they missed the run in stocks should re-examine their portfolio. He said they might consider gradually shifting some money from ultra-safe debt to riskier but higher-returning areas like high-yield bonds.

He said investors could then consider moving into the types of stocks that often fare well early in an economic recovery. These include stocks like technology, commodities producers, emerging markets and small-capitalization stocks. All of them have been strong performers.

White predicts investors will tire of earning little in the safest investments.

Bond prices traded mixed Friday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.33 percent from 3.38 percent late Thursday.

The dollar mostly fell against other major currencies, while gold prices fell.

Light, sweet crude rose 12 cents to $66.01 per barrel on the New York Mercantile Exchange.

Research in Motion fell $14.10, or 17 percent, to $68.96.

The Russell 2000 index of smaller companies fell 2.92, or 0.5 percent, to 598.83.

Overseas, Britain’s FTSE 100 rose 0.1 percent, Germany’s DAX index fell 0.4 percent, and France’s CAC-40 lost 0.5 percent. Japan’s Nikkei stock average fell 2.6 percent.