Wall Street on track for weekly loss

US stocks were little changed on Friday but remained on track for a second week of declines after JPMorgan Chase & Co revealed a trading loss of at least $2 billion from a failed hedging strategy.

The news weighed on bank shares, sending the Dow component down 8.9 percent to $37.11, but indexes rebounded off their early lows, continuing a trend this week of investors using dips as an occasion to buy.

Stocks were also buoyed by upbeat consumer sentiment data and an earnings beat by Nvidia Corp.

JPMorgan estimates the business unit involved in the trading loss will lose $800 million in the current quarter, excluding private equity results and litigation expenses. The bank had previously expected the unit to earn a profit of about $200 million.

Jamie Dimon, the chief executive of the biggest US bank by assets, cautioned that losses could grow by another $1 billion, another hurdle for a sector already besieged by the sovereign debt crisis in Europe and fears of slowing growth globally.

“This surprise has created a lot of uncertainty and is taking the wind out of our sails,” said Joseph Cangemi, managing director at BNY ConvergEx Group in New York.

“However, I see this as specific to JPMorgan, not a systemic issue, so I would be buying if I was looking at any specific financial at this time.”

Bank of America Corp fell 3.2 percent to $7.45 while Citigroup Inc lost 4.6 percent to $29.24 and the Financial Select Sector SPDR was off 1.8 percent to $14.72. The S&P financial sector fell 0.6 percent, extending its month-to-date losses to 4.7 percent.

Financial stocks have been among the most volatile in recent months as investors question what the growth outlook for the US and the debt crisis of Europe will mean for the group's profits. JPMorgan has fallen 14 percent this month.

The Dow Jones industrial average was up 6.85 points, or 0.05 percent, at 12,861.89. The Standard & Poor's 500 Index was up 1.43 points, or 0.11 percent, at 1,359.42. The Nasdaq Composite Index was up 15.18 points, or 0.52 percent, at 2,948.82.

The CBOE VIX Volatility Index is up 15 percent this month in a sign of growing caution.

For the week, the S&P is down 1.1 percent, the Dow is off 1.8 percent and the Nasdaq is down 1.2 percent. All three are on track for their second straight week of losses.

US consumer sentiment rose more than expected, advancing to its highest level in more than four years in early May as Americans remained upbeat about the job market, according to the Thomson Reuters/University of Michigan's preliminary May reading.

Producer prices fell 0.2 percent in April, below the expectation for flat growth.

Nvidia Corp rose 8.5 percent to $13.45 after reporting adjusted first-quarter earnings that beat expectations. The stock limited the Nasdaq's decline and was the S&P 500's top percentage gainer.

With 449 of the S&P 500 companies reporting results through Thursday morning, 66.4 percent exceeded estimates, according to

Thomson Reuters data, compared with more than 80 percent at the start of earnings season. - Reuters