Stock market heads for lower opening after sales report
Stock market: Stocks headed to a slightly lower opening Friday after the latest consumer spending number fell just short of expectations.
Stocks headed to a slightly lower opening Friday after the latest consumer spending number fell just short of expectations.Skip to next paragraph
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The Commerce Department said retail sales rose 0.4 percent in July. That was an improvement after two months of sales declines. It was just below economists' forecast of a gain of 0.5 percent. The report did show strength in auto sales.
Meanwhile, the Labor Department reported that the Consumer Price Index rose 0.3 percent last month. The gain, slightly above forecasts, was due to higher energy costs.
Stock index futures regained some ground after the reports, but are still lower. Dow Jones industrial average futures are down 9, or 0.1 percent, at 10,262. Standard & Poor's 500 index futures are down 2.30, or 0.02 percent, at 1,076.90. Nasdaq 100 futures are down 5.50, or 0.3 percent, at 1,821.75.
The yield on the Treasury's 10-year note, which is used to set rates on consumer loans including mortgages, was 2.72 percent, down from late Wednesday's 2.75 percent. Yields fall as prices rise. Treasury prices have risen sharply this week as investors — worried about the economy and watching stocks fall — sought a safer place for their money.
Investors will get another reading on the consumer later in the morning when the University of Michigan/Reuters survey of consumer sentiment in August will be released.
Consumer spending has remained weak along with the labor market. And there are no signs that employers are ready to start hiring at a pace to help lift the economy. On Thursday, the Labor Department said the number of people filing for unemployment benefits for the first time rose last week.
Stocks have been falling as investors' take on the economic recovery grows more and more pessimistic. The Dow Jones industrial average has lost 380 points over the past three days. Analysts say many traders are on vacation or just not willing to make any big moves on stocks. That has led to lower trading volume and some skewing of price changes.
Investors in Europe were more concerned with signs of slowing growth in the U.S. than in their own economies. They shrugged off news that the European economy had grown 1 percent during the second quarter.