WALL STREET Trade gap hits share prices

It was the biggest drop for the Dow since late September.
NEW YORK (AP) -- Stocks fell sharply Friday, with the Dow Jones Industrials losing more than 115 points, as Federal Reserve Chairman Alan Greenspan sounded a warning over the nation's spiraling trade deficit. Crude oil futures rose more than $2 per barrel, further pressuring stocks.
Greenspan's unusually frank assessment of the trade imbalance and its effect on the U.S. economy worried many investors. The Fed chairman said the economy was resilient thus far, but foreign investment could wane should the deficits continue to build and the U.S. dollar remain weak.
"Certainly that has investors worried, though I'm not entirely sure why Greenspan chose to make a case out of this," said Lincoln Anderson, chief investment officer at LPL Financial Services in Boston. "The lower dollar will eventually force importers to raise prices, and that'll help cut the trade deficit. But nonetheless, it was unusual for him to speak out on it like that, and it's having an effect."
The Dow Jones industrial average fell 115.64, or 1.09 percent, to 10,456.91. It was the biggest single-session point drop for the Dow since Sept. 22.
Broader stock indicators also finished substantially lower. The Standard & amp; Poor's 500 index was down 13.21, or 1.12 percent, at 1,170.34, and the Nasdaq composite index lost 33.65, or 1.6 percent, to 2,070.63.
Pushed to loss
Friday's performance pushed the major indexes to their first weekly loss after three straight weeks of gains, putting an end to the post-election rally on Wall Street. Most analysts, however, said the week's trading, and especially Friday's losses, were a pause in an overall positive market, and added that stocks would likely continue to rise into the new year.
For the week, the Dow fell 0.78 percent, the S & amp;P 500 shed 1.17 percent, and the Nasdaq lost 0.71 percent.
Friday's trading also was pressured by oil prices, which rose in response to a U.S. government report that showed a drop in inventory for distillates such as heating oil -- critical as winter approaches. A barrel of light crude was quoted at $48.44, up $2.22, on the New York Mercantile Exchange.
Despite oil prices and Greenpan's assessment of the trade deficit, analysts said that the overall market remains strong, and that Friday's selloff amounted to profit-taking after weeks of strong gains.
Blip on screen?
"Today is more of a blip on the screen, with people using Mr. Greenspan's comments as an excuse to take some profits," said Stewart Freeman, chief equity strategist for A.G. Edwards & amp; Sons. "We're exiting a period of uncertainty with the elections and terrorism and worries about slowing profit growth, and I think we're set up nicely to continue upward after this."
Pharmaceutical stocks fell as investors digested Thursday's Senate hearing over Merck & amp; Co.'s arthritis drug Vioxx, which was pulled from the market due to a high risk of heart attack and stroke. The Food and Drug Administration was roundly criticized for the way in which it approves drugs. Merck shed 24 cents to $27.12, while rival Pfizer Inc. slipped 54 cents to $27.23 and GlaxoSmithKline PLC slid 82 cents to $42.77.
Nike Inc. lost $2.50 to $82.50 after the company announced that co-founder Phil Knight was stepping down as president and chief executive officer. Knight will remain chairman of the sports shoe giant, while William D. Perez, a top executive at privately held S.C. Johnson & amp; Son Inc., will take over as president and CEO.
Sirius Satellite Radio Inc. also has new leadership, recruiting former Viacom Inc. president Mel Karmazin as its new CEO.
Sirius surged 45 cents, or 9.5 percent, to $5.17 on the news.