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Markets take a long lunch to end the week

U.S. markets mostly waver between gains and losses before closing down on an uneventful day, except for the hurricane that hits shares of Emulex.

U.S. markets mostly wavered between gains and losses before closing down on an uneventful day, except for the hurricane that hit shares of Emulex.

"Welcome to a Friday in August on the street of dreams," joked Bryan Piskorowski, a market strategist at Prudential. "There was a reluctance to take positions, but the reluctance to take profits can be seen as somewhat positive?If you're going to trade thin it might as well be on the somewhat bullish side," Piskorowski said.

The Nasdaq fell 10.60 to 4,042.68, and the Standard & Poor's 500 index dipped 1.85 to 1,506.46.

The Dow Jones industrial average rose 9.89 to close at 11,192.63 led by IBM, which rose $4.31 to $129.13.

The Standard & Poor's 500 Index finished the week unchanged as the Nasdaq gained nearly 3 percent from last week, and the Dow ticked up 1 percent

Both new and old economy stocks traded on light volume. The Nasdaq recorded a volume of 1.3 billion shares, while 671 million shares traded hands on the New York Stock Exchange.

The Commerce Department released revised data on economic growth for the second quarter. From April to June, the gross domestic product, the nation's total output of goods and services, rose at an annual rate of 5.3 percent, slightly higher than preliminary reports of 5.2 percent. The economy grew 4.8 percent in the first quarter.

The upwardly altered number suggests that the economy is growing faster than previously thought, but other data indicate that the once red-hot U.S. economy is poised for a slowdown.

Consumer spending in the second quarter rose 2.9 percent, the slowest gain since the second quarter of 1997. In the first quarter, consumer spending surged at a 7.6 percent rate, a 17-year high. Spending accounts for two-thirds of all economic output.

At the end of regular trading, Intel closed down $1.31 at $72.94. Microsoft also dropped 50 cents to $70.63.

The CNET tech index lost 13.33 to close at 3,288.42. Losers edged out winners, with 59 of the 97 stocks in the index falling, 37 rising and one remaining unchanged.

Of the 18 sectors tracked by CNET Investor, semiconductor makers posted the sharpest drops, falling about 2 percent. Computer aided design and manufacturing companies were the day's largest gainers, climbing 2 percent.

The Philadelphia semiconductor index fell 19.73 to 1,143.71, led by chip designer Rambus, which lost $4.06 to close at $86.13.

Emulex shares went on a wild ride. A fake news release that reported damning company news shaved $2 billion off the company's market value and created anxiety for thousands of investors.

The maker of computer-networking equipment fell as much as 60 percent to a day low of $43 then rebounded to a high of $130 before closing down $7.31 at $105.75. Volume topped 11 million shares, more than six times the stock's average daily volume.

Other companies got caught in the wave of wrath directed at Emulex. Qlogic, a semiconductor manufacturer, also fell $5.81 to $103.88 on a volume 16.7 million shares, more than six times the stock's average daily volume of about 2.6 million shares and making it the most active stock on the Nasdaq at one point. Shares of Brocade also fell $6.44 to $211.88.

Among members of the CNET tech index, Yahoo fell $5.56 to $134.25, and Broadcom dropped $5.50 to $268.13.

Shares of Razorfish fell 88 cents, or 6 percent, to $13.69 after the Web-site designer said president, Mike Pehl, is leaving, less than a year after joining the company.