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Stocks closed out a volatile week on Wall Street broadly in the red Friday, as investors digested a batch of mixed economic reports amid lingering concerns over whether central banks will pare back their stimulus programs.
"Markets are more fragile now, whereas they had been bulletproof by the bulls for the last six months," said Joe Saluzzi, co-manager of trading at Themis Trading.
"Unfortunately, the only thing that everyone cares about is what the Fed's doing and that's troubling, when we should be looking at economic data, fundamentals and corporate profits…There are still warning signs being flagged right now and people are getting concerned."
The Dow Jones Industrial Average fell 105 points to close the day at 15,070.18, dragged by DuPont and American Express.
Among key S&P sectors, financials and energy led the laggards, while utilities gained.
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"No matter what's happening with the Fed, investors realize that we're living on borrowed time and at some point, the stimulus has to be pulled back," said Jack Ablin, chief investment officer at Harris Private Bank. "With the threat of losing monetary stimulus, people are searching for fundamental value, which we've lost the connection since March. So we may see a little downside risk, but I don't view this as more than a correction."
Investors will closely watch on the Federal Reserve's policy-setting meeting next week for comments and clues into the central bank's plans for paring back some of its stimulus efforts.
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Japan's Nikkei rose by as much as 3 percent earlier on Friday, after the Japanese government gave the green light to measures to boost economic growth and Finance Minister Taro Aso played down recent declines in stock prices.
However, currency moves remained a concern on Friday, with the dollar-yen moving in-and-out of the 95-handle in choppy trade, but still remaining off Thursday's 10-week trough of 93.75.
Adding to woes, the IMF said while underlying fundamentals in the U.S. are gradually improving, the economy is still being restrained by government spending cuts and tax increases. The IMF revised its U.S. growth outlook for 2014 don to 2.7 percent, while maintaining the 2013 guidance at 1.9 percent.
On the economic front, consumer sentiment retreated to 82.7 in June after hitting its highest in nearly six years in May, according to the Thomson Reuters/University of Michigan's preliminary reading. Economists polled by Reuters had expected the level to hold at 84.5 this month.
Producer prices rose more than expected in May as gasoline prices rebounded, with the producer price index gaining 0.5 percent. Economists surveyed by Reuters expected a gain of 0.1 percent. And industrial production was unchanged in May, according to the Federal Reserve, missing expectations for a gain of 0.2 percent.
Current account deficit widened in the first quarter to $106.1 billion, according to the Commerce Department, falling from a downwardly revised $102.3 billion in the fourth quarter. Economists polled by Reuters expected a reading of $109.7 billion.