Stocks Fall amid Weak Economic Signals

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Precious metals mostly skidded following an unsubstantiated rumor a commodities hedge fund had collapsed. Comex April gold futures plunged $18.20 to $930.60 per ounce in late trading.

Among stocks in the news Friday, KB Home (KBH) posted a loss of $3.47 per share last quarter, compared to profits of 34 cents per share a year ago, as revenue fell 43%. The homebuilder's quarterly report included a $223.9 million loss due to declining home prices.

Lehman Brothers on Thursday was the subject of rumors -- quickly denied by the company -- that it is facing financial trouble of the sort that afflicted Bear Stearns (BSC). But on Friday, a Citigroup analyst upgraded the stock from hold to buy. The analyst, Prashant Bhatia, said "access to liquidity is a non-issue" for Lehman.

Clear Channel Communications (CCU) warned that the $19.5 billion deal to take the company private may not close, because the private equity buyers are having trouble securing financing from banks.

Red Hat (RHT) posted better than expected fourth-quarter non-GAAP earning s per share of 20 cents, vs. 16 cents one year earlier, on a 27% revenue rise.

Shares of Apollo Group (APOL) plunged after the for-profit education company reported a second-quarter loss of 19 cents per share vs. 35 cents EPS one year earlier as the inclusion of estimated litigation charges offset a 14% revenue rise. The company posted non-GAAP EPS of 48 cents, which was below the Wall Street consensus view of 52 cents.

Shares of Tiffany (APOL) fell after Merrill Lynch downgraded its rating on the jeweler to sell from neutral.

European markets finished lower Friday. In London, the FTSE 100 index fell 0.43% to 5,692.90, while Germany's DAX index shed 0.28% to 6,559.90, and France's CAC 40 index declined 0.5%, to 4,695.92.

Japan's Nikkei 225 rose 1.71% to 12,820.47, while Hong Kong's Hang Seng index gained 2.74% to 23,285.95.

Treasury market

Treasuries rallied as a tame prices component for the February core personal consumption expenditure eased inflation concerns. A weaker final reading on March University of Michigan consumer sentiment contributed to the bullish backdrop for bonds. The 10-year note rose 20/32 to 100-16/32 for a yield of 3.44%. The 30-year bond climbed 26/32 to 100-24/32 for a yield of 4.33%.