A market that had been looking for direction in recent weeks seems to have found one: down. The Dow Jones industrial average tumbled 220.40 points, or 1.83 percent, on Friday — closing below 12,000 for the first time since March — in a sell-off that left shares of financial firms battered — and the index staggering toward its low for the year. The decline capped a dreary week that forced investors to acknowledge that the resolution of the Bear Stearns collapse did not solve the problems facing the economy. With oil prices in record territory, worries about inflation have roared back into the picture, even as analysts suggested the recession may be lighter and shorter than previously feared. Investors are now left looking for clues about where the bottom is going to be. The Standard & Poor's 500-stock index lost 1.85 percent, or 24.90 points, on Friday and finished down 3.1 percent for the week. At 1,317.93, the S.& P. is just 3.5 percent above its low for the year — and down 15.8 percent from its all-time high in October. The Dow Jones industrial average, which closed Friday at 11,842.69, has followed a similar trajectory. It is less than a percentage point above its low for the year, 11,740.15, set on March 10 just before the sale of Bear Stearns to JPMorgan Chase. The Dow fell 3.8 percent this week.
