Stocks were mixed Friday as market participants kept their eyes on developments in Washington, D.C. as fears of a potential federal shutdown loom. The Dow Jones Industrial Average fell nearly 160 points, while the S&P 500 Index lost roughly 0.30% and the Nasdaq Composite added 0.14%.

Here's how the market settled to close out the week:

S&P 500 Index (SPY  ): -0.27% or -11.65 points to 4,288.05

Dow Jones Industrial Average (DIA  ): -0.47% or -158.84 points to 33,507.50

Nasdaq Composite Index (QQQ  ): +0.14% or +18.05 points to 13,219.32

All three of the major averages started the session higher Friday, as the latest reading of the personal consumption expenditures price index showed inflation rose at a less-than-expected rate in August.

The Commerce Department reported headline PCE increased 0.4% on the mouth and 3.5% from a year ago, while core PCE --which excludes food and energy prices -- increased by a less-than-expected 0.1% month-to-month and 3.9% annually. PCE is the Federal Reserve's preferred inflation gauge.

However, investors grew concerned over the health of the U.S. economy after House Republicans failed to pass a short-term spending bill on Friday, raising fears that Congress is likely to not pass a new budget before the Oct. 1 deadline. The government is set to shut down at 12:01 ET on Sunday if a bill is not passed and signed by President Joe Biden in time.

Friday's session closes a mostly negative week, month and quarter. The S&P 500 ended the week down 0.7%, 4.9% for the month and 3.7% for the quarter. The Dow fell 1.3% for the week, 3.5% for the month and 2.6% in the third quarter. Lastly, the Nasdaq closed the week at a positive flatline, but ended September down 5.8% and lost 4.1% for the quarter.

Elsewhere, the United Auto Workers (UAW) union announced an expansion of its strikes against General Motors (GM  ) and Ford (F  ) to two U.S. assembly plants on Friday, targeting Ford's Chicago Assembly Plant in Illinois and GM's Lansing Delta Township plant in Michigan. UAW President Shawn Fain said Stellantis (STLA  ) will not face additional strikes due to recent progress in negotiations with the Chrysler parent.

The additional strikes adds about 6,900 workers to the roughly 18,300 striking union members, meaning about 17% of UAW workers are on strike as of Friday.

On the earnings front Friday, Nike (NKE  ) shares rose higher after its fiscal first-quarter earnings report topped expectations. However, its revenue fell short of sales estimates for the first time in two years. The retailer maintained its full-year guidance for revenue growth in the mid-single digits and gross margin increase of 1.4 to 1.6 percentage points.

"We're closely monitoring the operating environment, including foreign currency exchange rates, consumer demand over the holiday season, and our second half wholesale order book," said CFO Matthew Friend on a call with analysts. "We are cautiously planning for modest markdown improvements for the balance of the year, given the promotional environment."

Looking ahead, market participants will react to a potential U.S. federal shutdown next week and look for more clues on the health of the economy and the consumer heading into the final quarter of the year.