Stocks Fall on Profit-Taking

Blue chips fell Friday as four sessions of gains finally prompted investors to take in some profits; Exxon Mobil Corp. and 3M Co. dragged on the Dow.

The Dow Jones industrial average (search) ended Friday's session down 21.28 points, or 0.20 percent, at 10,471.91. The Standard & Poor's 500 Index (search) finished down 1.80 points, or 0.15 percent, at 1,189.28. The technology-laced Nasdaq Composite Index (search) ended Friday's session up 3.84 points, or 0.19 percent, at 2,046.42.

With a tame reading on the core consumer price index on Wednesday showing no increase in inflation and a drop this week in oil prices, the broad market flourished as investors poured money back into stocks. Through Thursday's close, the Dow and the S&P 500 had posted four straight days of gains.

For the week, the Dow climbed 3.27 percent and the S&P 500 rose 3.05 percent, their best percentage gains since the week of the U.S. presidential election in early November. Nasdaq was up 3.5 percent for the week, its best gain since mid-August 2004.

"One of the key things this week was the rotation out of commodity-sensitive names and into areas that had been thrown out, including technology and select financials and consumer discretionaries," said Michael Sheldon, chief market strategist at New York brokerage Spencer Clarke.

Exxon Mobil Corp. (XOM) fell 1.5 percent to $54.01 after a federal judge ordered Exxon to pay damages to more than 10,000 gas station owners for overcharging on gasoline for more than a decade. A plaintiffs' attorney said the ruling could cost the company $1.3 billion.

3M Co. (MMM) slid 1 percent to $77.06, also dragging on the Dow, after Smith Barney suggested investors shift their positions out of that company and into General Electric Co. (GE) because GE offers more attractive earnings growth. GE was up 8 cents at $37.

Helping the Nasdaq was Symantec Corp. (SYMC), up almost 2 percent, or 41 cents, at $22.11 after UBS upgraded its rating on the world's largest security software maker to "buy" from "neutral."

Crude oil futures vacillated most of the session and finished modestly lower. A barrel of light crude for June delivery was quoted at $46.80, down 12 cents, on the New York Mercantile Exchange (search).

"It's definitely been a good run, and it's good that you see the market today sitting back, digesting a bit relaxing," said Jay Suskind, head trader at Ryan Beck & Co. "We haven't had a huge bout of profit taking here, so maybe we're building a base and maybe we can start trading in a higher range than we did in April."

Homebuilding stocks fell after Federal Reserve (search) Chairman Alan Greenspan (search) said the U.S. housing sector shows signs of some "froth."

Greenspan told the Economic Club of New York that while the central bank does not see a national housing bubble, "it's hard not to see ... that there are a lot of local bubbles."

The Dow Jones home construction index fell 6.67 points, or 0.76 percent, to 872.66.

"Greenspan talking a little hawkishly on the housing market was a little damper, but it's only having an impact on the home builders as opposed to the broad market," said Peter Boockvar, equity strategist at Miller Tabak & Co.

"The problem is, if Greenspan is right and there is a bubble that will come down, it will impact the entire economy."

Maytag Corp. (MYG) , a top American maker of washing machines and other home appliances, soared 24.6 percent, or $2.84, to $14.40 a day after it agreed to be acquired for $1.125 billion by investors led by private equity firm Ripplewood Holdings LLC.

General Motors Corp. (GM) climbed 23 cents to $32.98 after The New York Times reported the automaker planned to cut back on production and streamline its product offerings. Only Cadillac and Chevrolet will offer full lines of cars and trucks, with the company's other brands focusing on different types of cars.

Gap Inc.'s (GPS ) quarterly profit fell 7 percent from a year ago as sales slumped, but the clothing chain's earnings still beat analysts' expectations by a penny per share. The company plans a number of summer promotions and products to revive sales. Gap fell 28 cents to $21.46.

Time Warner Inc. (TWX ) lost 14 cents to $17.61 after the media conglomerate announced it would begin paying a quarterly cash dividend of 5 cents per share starting in the third quarter.

Trading was moderate, with 1.29 billion shares changing hands on the New York Stock Exchange, below the 1.46 billion daily average for last year. About 1.53 billion shares were traded on Nasdaq, below the 1.81 billion daily average last year.

Declining stocks outnumbered advancers on the NYSE by about 18 to 15 and on Nasdaq, by roughly 16 to 15.

The Russell 2000 index of smaller companies was down 1.05, or 0.17 percent, at 609.41.

Overseas, Japan's Nikkei stock average fell 0.36 percent. In Europe, Britain's FTSE 100 closed up 0.18 percent, France's CAC-40 gained 0.25 percent for the session, and Germany's DAX index edged 0.01 percent higher.

Reuters and the Associated Press contributed to this report.