New York ? U.S. stocks on Friday lapsed back into the cellar to close with weekly losses after a late-day burst into positive turf that followed reports that Federal Reserve Chairman Ben Bernanke offered the central bank’s discount window to battered mortgage lenders Fannie Mae and Freddie Mac.

Senior government officials prepared emergency steps Friday to rescue the mortgage giants but stopped short after a campaign of public statements eased immediate concerns about the stability of the institutions.

Off its earlier lows that had the Dow Jones Industrial Average dropping below the 11,000 level for the first time since August 2006, the blue-chip index settled at 11,100.54, down 128.48 points, or 1.1 percent. For the week, the Dow lost 1.6 percent.

Of the Dow’s 30 components, 21 settled lower, with Chevron Corp. fronting the declines, off 4.2 percent.

The spiking price of crude also weighed, with tensions between Iran and the West and worries about supply sending futures to an all-time high above $147 a barrel in electronic trade on Globex.

Shares of Dow component General Electric Co. tilted slightly higher after the conglomerate affirmed its 2008 outlook. The Dow component also said that it would sell its Japanese consumer-lending unit for $5.4 billion.

The S&P 500 Index dropped 13.89 points, or 1.1 percent, to 1,239.50, giving it a weekly loss of 1.8 percent from last week’s finish.

Of the S&P’s 10 industry groups, all fell, with the bloodletting fronted by financials, off 2.5 percent.

The Nasdaq Composite Index skidded 18.77 points, or 0.8 percent, to 2,239.08, giving the technology-laden index a 0.3 percent weekly loss.

Volume on the New York Stock Exchange topped 1.7 billion, and decliners topped advancers more than 2 to 1. On the Nasdaq, more than 1 billion shares traded, and decliners edged just ahead of advancing issues.