NEW YORK (CNN/Money) - U.S. stocks closed lower on Friday and for the week, as investors, on edge about the war in Iraq, bailed out of equities.

The Dow Jones industrial average (down 55.68 to 8145.77, Charts), the Standard & Poor's 500 (down 5.02 to 863.50, Charts) index, and the Nasdaq composite (down 14.65 to 1369.60, Charts) all closed modestly lower, after zigzagging on both sides of unchanged throughout the session.

With stocks sinking in four out of five sessions, all three indexes closed lower for the week, breaking a two-week winning streak. The Dow lost 4.4 percent this week, the S&P 500 lost 3.6 percent and the Nasdaq lost 3.7 percent.

After briefly peeking into positive territory last week, the Dow and the S&P 500 are back in the red for 2003. The Nasdaq remains marginally higher.

"People are starting to get frustrated with the see-sawing of the market -- good news and it's up, bad news and it's down. You're seeing a burnout from that, with people getting oversaturated by the constant war news and now starting to just hold off from doing anything rather than try to play the swings," said Bill Roe, a portfolio manager at Melhado, Flynn & Associates.

"I don't think investors are discouraged, they're just not sure what to do," Roe added. "People want to get this out of the way. We've got so many other things to work through, with the economy struggling and the budget."

Long gone is the initial euphoria about a swift and successful war that boosted stocks last week. This week's trading has been weighed down by increasing evidence that coalition forces are meeting greater resistance than expected, despite denials of such from U.S. and British officials. However, all parties involved agree the war will last longer than initially thought, stretching on for months and not weeks.

Investors took in more mixed news Friday. On the upside, after much debate, the United Nations Security Council has agreed to restore its humanitarian aid to Iraq, which takes some of the pressure off the U.S. in terms of the costs of war and rebuilding.

But on the downside, Secretary of Defense Donald Rumsfeld issued a warning to Syria, saying that its shipment of equipment to Iraq is seen as a hostile act, worrying investors that the conflict could extend beyond Iraq. (For details on the latest action, go to CNN.com)

Next week is heavy on economic reports. Among those expected: auto sales, the Institute for Supply Management's closely watched surveys on both manufacturing and services, the Chicago PMI (a regional survey of manufacturing), factory orders, construction spending, and the monthly report on unemployment.

Investors will also take in earnings news from Dow component Alcoa (AA: Research, Estimates), as well as El Paso (EP: Research, Estimates), Best Buy (BBY: Research, Estimates), Circuit City (CC: down $0.20 to $5.34, Research, Estimates) and Bed, Bath and Beyond (BBBY: Research, Estimates).

Stocks tumbled on pessimism about the war and the impact it will have on the already weak U.S. economy. Within the selling this week, traders have jumped in here and there to grab shares, sometimes on news and rumors, sometimes on bargain hunting. But by and large, the trend has been downward for the week.

"People have been stopped in their tracks," said Jon Burnham, portfolio manager at Burnham Securities. "It's impossible to trade the market right now because there's no way to know what's going to happen in Iraq hour to hour, day to day, so I think most individual investors are hanging back and any action is dominated by hedge funds."

"I think the market is acting well considering the geopolitical situation. We've held on to a lot of our gains since last week's rally," Burnham added. "There haven't been many negative earnings pre-announcements. That's one of the reasons the market isn't down more. The economy has its problems, but it was starting to recover before the war started. I'm optimistic in the long run."

Shares of Altria Group (MO: down $1.17 to $32.13, Research, Estimates) lost 3.5 percent after Italy's antitrust regulators fined the firm 50 million (or approximately $54 million) after an investigation into pricing by tobacco companies in the country. Altria said it will appeal the ruling.

In addition, ratings agency Standard & Poor's said that the firm's corporate credit ratings remain on credit watch with negative implications and could be lowered in the near term. The stock was the Dow's biggest decliner.

But it was one of a few stock stories creating pressure for investors, amid the overwhelming weight of the war.

In other corporate news, food issues were under pressure after a Wall Street Journal report said an accounting probe of retailer Ahold (AHO: down $0.17 to $3.54, Research, Estimates) could be expanded to include Sara Lee and ConAgra. In February, Ahold said it had found accounting irregularities at its U.S. Foodservice unit. ConAgra (CAG: down $1.83 to $19.65, Research, Estimates) stock lost 8 percent and was the NYSE's second most-active issue. Sara Lee (SLE: down $1.17 to $18.69, Research, Estimates) shares lost 6 percent.

Controversial biotech ImClone (IMCL: up $0.98 to $18.36, Research, Estimates) was unusually active on the Nasdaq, up nearly 6 percent on news that its cancer drug, Erbitux, is shaping up to meet European regulatory approval and could be on the market as early as 2004 through Germany's Merck KGaA, which has licensed the drug. The German company is not related to Dow stock Merck & Co.

But the stock was a rarity, with most of the Nasdaq's most-actives closing lower, including heavily weighted issues such as Cisco Systems (CSCO: down $0.28 to $13.22, Research, Estimates) Intel (INTC: down $0.36 to $17.22, Research, Estimates) and Oracle (ORCL: down $0.26 to $11.10, Research, Estimates), which all lost about 2 percent.

Market breadth was mixed. On the New York Stock Exchange, advancers edged decliners 6 to 5 as almost 1.21 billion shares traded. Volume was 1.30 billion shares on the Nasdaq, where losers edged winners.

The morning's economic reports were greeted with only minimal interest, due to the preoccupation with the war.

The University of Michigan's March consumer sentiment index was revised upward to 77.6, from the initial 75.0 reading. This was better than the unchanged reading economists surveyed by Briefing.com were expecting, but was down from the upwardly revised 79.9 reading in February and still near a 10-year low.

Personal income growth slowed in February, rising 0.3 percent after rising 0.4 percent in January. Analysts surveyed by Briefing.com expected growth of 0.2 percent. Personal spending was unchanged from January.

Treasury bonds rose, with the 10-year note adding 6/32 of a point in price, pushing its yield down to 3.90 percent from 3.92 percent late Thursday. The dollar was weaker versus the euro and yen.

Oil prices were a little lower amid the war worries and concern over civil unrest in Nigeria. Light sweet crude futures lost 21 cents to $30.16 a barrel in New York. Gold prices gained again, adding $3.10 to trade at $332.40 an ounce.