U.S. factory activity grew at the slowest pace in six months last month, weakened by declines in orders and production, according to the Institute for Supply Management. While the sector is still in good health, growth was slower than economists had forecast.
The Standard & Poor’s 500 index fell 0.70 points, or less than 0.1 percent, to 2,058.20. The Dow Jones industrial average rose 9.92 points, or less than 0.1 percent, to 17,832.99. The Nasdaq composite dropped 9.24 points, or 0.2 percent, to 4,726.81.
Stocks had another good year in 2014, but the rally faded in the final days of the year. The S&P 500 climbed 11.4 percent, after rising 29.6 percent in 2013. To justify those gains, company earnings will have to keep growing.
On Friday, stocks started out with solid gains, then fell back after the ISM published its manufacturing report. After drifting lower for much of the afternoon, the market recovered slightly and ended the day little changed.
U.S. crude fell after moving between losses and small gains. The price dropped 58 cents to $52.69 a barrel in New York. Brent crude, the international standard, declined 91 cents to $56.42.
Declining in oil prices are a boon to consumers, who are paying less for gas, but they hurts energy companies by lowering their revenues. The energy industry accounts for about 10 percent of earnings of companies in the S&P 500 index.
The fall in prices will also mean that oil companies will rein in spending on plants and equipment, said Anastasia Amoroso, global market strategist for J.P. Morgan Funds.
“The benefit of lower oil prices is incremental to the damage that they inflict on other parts of the economy,” Amoroso said.
In currency trading, the euro retreated against the dollar. The decline came after European Central Bank President Mario Draghi indicated that the bank could support a government bond-buying program to combat alarmingly low inflation in the eurozone. The currency fell to $1.2003, its lowest level against the dollar in 4-1/2 years.
Investors have a number of concerns about Europe as 2015 begins. Growth is anemic in the region and an election in Greece on Jan. 25 could re-ignite the country’s debt crisis if an anti-austerity party wins.
In government bond trading, prices rose. The yield on the 10-year Treasury note fell to 2.11 percent from 2.17 percent on Wednesday. Markets were closed Thursday for New Year’s Day. The dollar also rose against the Japanese yen, climbing 0.6 percent to 120.51.
In metals trading, gold edged up $2.10 to $1,186.20 an ounce, silver rose 17 cents to $15.77 an ounce and copper slipped less than a penny to $2.82 a pound.
In other energy futures trading:
— Wholesale gasoline dropped 3.9 cents to $1.433 per gallon.
— Heating oil fell 3.8 cents to $1.796 a gallon.
— Natural gas rose 11.4 cents to $3.003 per 1,000 cubic feet.