US stocks dip as Yellen reaffirms 2015 rate hike

Wall Street stocks finished lower Friday in light pre-holiday trade after Federal Reserve Chair Janet Yellen said the plan to raise interest rates this year was on track.

The Dow Jones Industrial Average dropped 53.72 points (0.29 percent) to 18,232.02.

The broad-based S&P 500 fell 4.76 (0.22 percent) to 2,126.06, while the tech-rich Nasdaq Composite Index slipped 1.43 (0.03 percent) to 5,089.36.

Yellen said delaying a move to raise interest rates "would risk overheating the economy." However, she also warned that the US economy continues to show weakness, with significant job market slack not reflected in the 5.4 percent jobless rate.

Analysts said trading volume was light ahead of Monday's Memorial Day holiday, when markets will be closed.

Shares of clothing retailer Gap fell 1.4 percent after first-quarter net income dropped eight percent to $239 million. Comparable sales at its Old Navy chain rose three percent, but fell sharply at Banana Republic and its namesake stores.

Farm equipment maker Deere & Co. jumped 4.4 percent after easily topping earnings expectations. It reported profits of $2.03 per share, compared with the $1.55 projected by analysts.

China's eLong surged 8.7 percent after US online travel company Expedia announced it had sold its majority stake in the  company to several Chinese companies for $671 million. Expedia jumped 6.7 percent, while Ctrip.com International, one of the buyers, surged 17.6 percent.

Time Warner Cable pushed 3.4 percent higher on renewed speculation it could be acquired. Reuters reported Friday that French telecom giant Altice was in talks with banks to raise debt for a bid.

Bond prices were mixed. The yield on the 10-year US Treasury rose to 2.21 percent from 2.19 percent Thursday, while the 30-year held steady at 2.99 percent. Bond prices and yields move inversely.