US stocks fell on Friday, putting the S&P 500 on track for a fifth straight decline, as President Barack Obama and top congressional leaders were set to make a last-ditch attempt to steer the country away from severe fiscal austerity next year. Obama and lawmakers from both political parties will meet at the White House on Friday afternoon for talks in an effort to agree on a solution before a New Year's deadline to keep large tax hikes and spending cuts from taking effect.

Economists say that combination of automatic higher taxes and lower government spending - known as the "fiscal cliff" - could push the US economy into a recession. Trading was volatile and stocks rebounded from their session lows after unconfirmed reports that President Obama was about to offer a new plan to Republicans.

But investors' pessimism about achieving anything more than a stop-gap deal by the deadline was reflected in the benchmark S&P 500's drop of 1.3 percent so far this week. The broad index was on pace for its worst weekly performance since mid-November. A five-day decline would be the S&P 500's longest losing streak in three months. The Dow Jones industrial average fell 65.65 points, or 0.50 percent, to 13,030.66. The Standard & Poor's 500 Index dropped 6.03 points, or 0.43 percent, to 1,412.07. The Nasdaq Composite Index slipped 7.29 points, or 0.24 percent, to 2,978.62.

Copyright Reuters, 2012