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Stocks slip on consumer spending

Traders work on the floor of the New

Traders work on the floor of the New York Stock Exchange at the end of the trading day Thursday, May 29, 2014, on Wall Street. Credit: EPA / Justin Lane

Stocks moved lower Friday as investors reacted to two negative economic reports that focused on U.S. consumers. Lions Gate Entertainment plunged after the movie studio known best for "The Hunger Games" reported a steep drop off in quarterly income.

KEEPING SCORE: The Dow Jones industrial average lost 34 points, or 0.2 percent, to 16,664 as of 12:55 p.m. on Wall Street. The Standard & Poor's 500 index was down two points, or 0.1 percent, to 1,918 and the Nasdaq composite lost 15 points, or 0.4 percent, to 4,232. The S&P 500 closed at a recorded high on Thursday.

NO SALE: Consumer spending unexpectedly fell 0.1 percent in April, according to the Commerce Department.

The drop was the first in a year, but economists expect it to be temporary.

In a separate report, the University of Michigan's consumer sentiment index fell more than analysts were expecting. The index fell to 81.9 in May from 84.9 in April. Economists had expected 82.8.

"The reports were lackluster at best," said Karyn Cavanaugh, a market strategist with Voya Investment Management, formerly known as ING Investment Management.

MAY GOES AWAY: Friday is the last trading day of May, which has been a relatively strong month for markets.

The S&P 500 is up 1.8 percent, which would be its best month since February. The Nasdaq is up 2.9 percent and the Dow is up 0.5 percent.

LIONS GATE LOCKED OUT: Lions Gate Entertainment dropped $3.67, or 12 percent, to $25.85 after reporting a profit of 35 cents per share, a 70 percent drop from the year before and well below what analysts had expected.

SOLAR ECLIPSE: Sunglasses retailer Pacific Sunwear dropped 51 cents, or 17 percent, to $2.43. The company warned investors that would report a two-cent loss this quarter versus the two-cent profit that analysts had expected.

SLOW LANE: Clothing chain Express sank $1.35, or 10 percent, to $12.28 after the company also cut its full-year forecast. Express also said it plans to close roughly 50 stores.

BONDS: The yield on the 10-year Treasury note was little changed at 2.47 percent. Bond yields are the near their lows for the year thanks to strong demand from foreign and U.S. buyers.

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