Stocks finished last week mixed after digesting a flurry of economic data. The Dow declined for the second straight week. For the week ended June 26:

Dow: Down 1.2% to 8438.39
S&P 500: Down 0.3% to 918.9
Nasdaq: Up 0.6% to 1838.22

The run in stocks the last three months continued to flounder as optimism surrounding a stabilizing economy gave way to the realization that recovery could be tepid. Case in point, the savings rate jumped to an annual rate of $768.8 billion, the highest level on record since 1959. While it's good that consumers are being more prudent, it also means they aren't spending -- which leads to short-term turbulence in a consumer-led economy. Adding to the mixed bag of data was a bigger-than-anticipated increase in continuing jobless claims, while durable goods orders unexpectedly climbed in May -- a positive sign for an easing recession. The outlook for global growth this year was also downgraded by the World Bank.

Additionally, as the end of the second quarter is nearing, "window dressing" is beginning, which traditionally happens toward the end of a quarter when portfolio managers will buy or sell certain stocks to improve the appearance of their portfolio's performance for investors.

Companies provide specific examples of the status of the economy
In company specific news, Palm (Nasdaq: PALM) said its fourth-quarter loss widened from a year ago. However, the handset maker's Pre smartphone, which exceeded expectations, launched after the quarter's end. Additionally, Palm said it expects to be cash-flow positive by the end of the calendar year -- a nice stride back to profitability as the company tries to reestablish itself.

Software company Oracle (Nasdaq: ORCL) posted a 7.2% decline in fiscal fourth-quarter earnings, hurt by the strong U.S. dollar (half of its sales originate from overseas.) A 13% decline in new software, as businesses delayed purchases, also contributed. Oracle is considered a bellwether for business spending. However, the company, which is weathering the downturn well and is gaining market share, issued upbeat earnings guidance inline to above the Street.

On the home front …
KB Home (NYSE: KBH) posted a narrower second-quarter loss from a year ago while revenue plunged 40%. New home orders were down 31% from a year ago. The homebuilder said it's starting to see signs that "negative housing trends may be moderating at a local and national level."

Lennar (NYSE: LEN), one of the nation's largest homebuilders, posted a wider-than-expected second-quarter loss as sales fell 21% and the average price of homes sold slipped 8%. The good news was that the homebuilder saw a sequential increase in new home sales from the first quarter due to lower rates and government incentives (and the seasonality of housing sales). Continued...