Stocks end lower as bank shares weigh

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NEW YORK (CNNMoney) -- Stocks finished lower Friday, ending a down week for the major indexes, as weakness in the banking sector weighed on the market.

Shares of JPMorgan Chase (JPM, Fortune 500) fell 9% after the firm disclosed a $2 billion loss late Thursday. CEO Jamie Dimon cited "errors" and "bad judgment" in trades meant to hedge risk.

The news raised questions about whether conditions since April would cause additional not-yet-reported losses at other big banks. Shares of Citigroup (C, Fortune 500), Morgan Stanley (MS, Fortune 500) and Goldman Sachs (GS, Fortune 500) all fell. After the market closed, Fitch downgraded JPMorgan's debt rating by one notch.

Shares of Chesapeake Energy (CHK, Fortune 500) fell 14% after the troubled natural gas company said in a regulatory filing that it may delay some planned asset sales.

Meanwhile, the technology sector was supported by shares of chip-maker Nividia (NVDA), which rose nearly 7% on better-than-expected quarterly results. Netflix (NFLX) was also strong.

The Dow Jones industrial average (INDU) fell 34 points, or 0.3%, to end at 12,820. The S&P 500 (SPX) lost 5 points, or 0.3%, to 1,353. The Nasdaq (COMP) inched up less than one point to end little changed at 2,934.

The major indexes all ended lower for the week. The Dow fell 1.7%, the S&P lost 1.2% and the Nasdaq declined 0.7%.

Stocks opened lower Friday but rebounded after a key index of consumer confidence unexpectedly rose to a four-year high in May. Investors also welcomed a report that showed inflation remained subdued in April.

"I don't see a lot of conviction out there," said Bernard Kavanagh, vice president of portfolio management for St. Louis-based broker Stifel Nicolaus. "It doesn't seem like anyone is willing to make any big moves either way."

Traders said the overall tone was cautious as the debt crisis in Europe continues to hang over the market.

Spain announced plans Friday to require banks to set aside an additional €30 billion to offset potential losses. The government will also hire two independent auditors to review the banks' assets, in an effort to assure investors about their viability.

Greek politicians are still struggling to form a coalition government, which makes the future of austerity measures and a European bailout unclear.

In China, a report showed an unexpected drop in the rate of industrial production growth, which could feed fears of a so-called hard landing for the world's No. 2 economy.

"I think we continue to head lower because Europe is still a problem and the global economy is slowing down," said Peter Boockvar, chief market strategist with Miller Taback & Co.

U.S. stocks ended mixed Thursday, as investors welcomed a small drop in jobless claims.

Economy: The Reuters/University of Michigan consumer sentiment index for May rose to 77.8 from 76.4 in April. It was the highest level since January 2008. Economists surveyed by Briefing.com predicted the index to come in at 75.

Lower energy prices took wholesale prices down 0.2% in April, according to the Labor Department's producer price index. Economists surveyed by Briefing.com had expected prices to be unchanged from March. But stripping out volatile food and energy prices left core wholesale prices up 0.2%, which matched forecasts.

World markets: European stocks closed higher for the most part. Britain's FTSE 100 (UKX) rose 0.6%, the DAX (DAX) in Germany added 0.9%. France's CAC 40 (CAC40) ended flat.

Asian markets ended in the red. The Shanghai Composite (SHCOMP) closed down 0.6%, as did Japan's Nikkei (N225), while the Hang Seng (HSI) in Hong Kong lost 1.3%.

Companies: Shares of upscale retailer Nordstrom (JWN, Fortune 500) fell after it reported earnings of 70 cents a share, which fell 5 cents short of forecasts, despite revenue that was roughly in line with forecasts.

U.S. shares of Sony (SNE) fell after it sank 6.5% in Tokyo to a multi-decade low in its home market. Sony reported lower earnings after the close of the market in Tokyo on Thursday, which hit before the New York exchange opened.

Shares of Monster Worldwide (MWW) soared on Friday after a news report said LinkedIn (LNKD) has expressed interest in buying the online job-search company. But a source close to LinkedIn said the company has "zero interest" in buying Monster, and doesn't plan to pursue a purchase in the future.

Currencies and commodities: The dollar fell against the euro, but rose versus the Japanese yen and British pound.

Oil for June delivery lost 95 cents to end at $96.13 a barrel.

Gold futures for June delivery tumbled $11.50 to settle at $1,584 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, leaving the yield near the 1.84% level.