Market eyes Europe, DC after worst week in 8

The worst week for US stocks in two months ended with traders mostly sitting it out on Friday as they waited for politicians in Europe and the United States to tackle festering debt problems.

The Dow and S&P 500 were little changed and the Nasdaq composite index fell.

In the United States, doubts grew whether a bipartisan committee could come up with budget cuts and tax increases that Congress can agree on next week.

Financial shares, which have been among the most sensitive to euro zone financial strains, rose on Friday. The S&P financial index was up 0.5 percent.

The Dow Jones industrial average gained 25.43 points, or 0.22 percent, to 11,796.16. The S&P 500 dipped 0.48 point, or 0.04 percent, to 1,215.65. The Nasdaq Composite lost 15.49 points, or 0.60 percent, to 2,572.50.

European shares ended at a six-week closing low after comment from German Chancellor Angela Merkel cooled market hopes that Europe's largest economy would back monetary measures to tackle the euro zone debt crisis.

The FTSEurofirst 300 index of top European shares closed 0.7 percent lower at 950.95 points, for a weekly fall of 3.4 percent.

The Nikkei stock average slid below 8,400 to its lowest level in more than a month, after the surging bond yields in euro zone nations spooked investors and fuelled fears of tightening global credit conditions.

The Nikkei fell 1.2% to 8,374.91, marking a weekly loss of 1.6 %. The broader Topix index shed 1.1% to 719.98, losing 1.3% for the week.