Investing.com - U.S. stocks fell on Friday after investors sold and jumped to the sidelines ahead of next week's Federal Reserve statement on interest rates and monetary policy.
At the close of U.S. trading, the Dow 30 fell 0.36%, the S&P 500 index fell 0.60%, while the NASDAQ Composite index fell 0.53%.
The Volatility S&P 500 index, which measures the outlook for market volatility, was up 3.98% at 13.31.
The Fed will meet next week to review monetary policy, and markets are hoping for hints as to when benchmark interest rates will rise.
The Fed is also expected to cut its quantitative easing program to $10 billion in Treasury and mortgage-backed securities purchased each month from $15 billion before closing the program in October.
Upbeat data fueled expectations for a hawkish Fed statement due out next Wednesday, prompting investors to sell stocks for profits and head to the sidelines ahead of time.
The Thomson Reuters/University of Michigan preliminary consumer sentiment index rose to a 14-month high of 84.6 this month from 82.5 in August. Analysts had expected the index to rise to 83.3 in September.
The report came after official data showed that U.S. retail sales rose 0.6% last month, in line with expectations. Retail sales for July were revised to a 0.3% gain from a previously estimated flat reading.
Core retail sales, which exclude automobiles, increased by 0.3% in August, also in line with market expectations and growing at the fastest pace since April. July's figure was revised to a 0.3% gain from a previously estimated 0.1% rise.
Falling oil prices sent energy stocks edging lower earlier, which also added to Friday's profit taking.
Military conflicts in Ukraine and in the Middle East have rattled nerves in recent weeks, though oil shipments have flowed normally without disruptions, which sent energy companies falling on Friday as investors continued to wind down positions carrying geopolitical risk premiums.
Leading Dow Jones Industrial Average performers included Goldman Sachs Group Inc (NYSE:GS), up 1.16%, J P Morgan Chase & Co (NYSE:JPM), up 0.46%, and McDonald's Corporation (NYSE:MCD), up 0.41%.
The Dow Jones Industrial Average's worst performers included Exxon Mobil Corporation (NYSE:XOM), down 1.29%, Verizon Communications Inc (NYSE:VZ), down 1.25%, and Coca-Cola Company (NYSE:KO), down 1.18%.
European indices, meanwhile, ended the day mixed.
After the close of European trade, the DJ Euro Stoxx 50 fell 0.12%, France's CAC 40 rose 0.02%, while Germany's DAX fell 0.41%. Meanwhile, in the U.K. the FTSE 100 rose 0.11%.
On Friday, the U.S. is to release data on retail sales, a government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is also to release what will be closely watched preliminary data on consumer sentiment.