Equities are slumping after gross domestic product was
downwardly revised to a 1.9% annual pace and data showed business
activity in the U.S. expanded in May at the slowest pace in over
two years. Markets also are laboring after the number of Americans
applying for unemployment insurance payments rose last week to a
one-month high. Continuing concerns over the European economy also
Most industrial sectors in the S&P 500 are lower, led by
declines in energy and material stocks as commodities tumbled again
as the U.S. dollar rises against other currencies. Utility stocks
are the lone gainers today although financial shares have trimmed
their losses and trading nearly even as a group at mid-day.
The U.S. economy grew more slowly in the first quarter than
previously estimated, with gross domestic product climbing at a
1.9% annual rate, down from a 2.2% prior estimate, the Commerce
Department reported today. The report also showed corporate profits
rose at the slowest pace in more than three years and smaller wage
gains at the end of 2011.
A report from the Institute for Supply Management-Chicago found
factory activity in the Midwest cooled this month. The group said
its business barometer fell to 52.7, the lowest since September
2009, from 56.2 in April. A reading above 50 indicates expansion in
the regional economy.
On the labor front, initial claims for state jobless benefits
rose 10,000 last week to a seasonally adjusted 383,000, a Labor
Department report showed. Claims have now risen in seven of the
last eight weeks. Private employers, meanwhile, created 133,000
jobs in May, payrolls processor ADP said. That was only a slight
step up from April's 113,000 increase and below economists'
expectations for a gain of 148,000.
Investors also watched the latest developments in Europe's
attempts to tame its crisis. Italy's prime minister and central
bank chief pressed Germany to back more aggressive efforts to snuff
out the escalating debt crisis, setting up a south-north showdown
over how to stabilize the 17-nation euro economy.
In company news, Talbots Inc. (
) nearly doubled today, rising 90% after the retailer agreed to be
purchased for $2.75 a share in cash by New York-based private
equity firm Sycamore Partners. The price values store chain at
about $369 million, including debt. On May 25, Talbots said
Sycamore scrapped a deal to buy the company at $3.05 a share.
Crude oil for July delivery is off $1.44 to $86.38 a barrel
after the U.S. Energy Information Administration reported a 2.2
million barrel rise in U.S. crude supplies for the week ended May
25. Analysts polled by Platts expected a climb of 100,000 barrels
in crude supplies. July natural gas is up 2.5 cents at $2.445 per 1
million BTU. August gold is down $2.70 to $1,563 an ounce, July
silver is down 26 cents to $27.72 an ounce, and July copper is off
nearly 4 cents at $3.3530.
Among energy ETFs, the United States Oil fund is down 1.48% to
$32.52 with the United States Natural Gas fund is up 1.41% to
$17.15. Among precious-metal funds, the Market Vectors Gold Miners
ETF is off 1.18% to $43.72 and SPDR Gold Shares are down 0.13% to
$151.71. The iShares Silver Trust is down 0.33% to $27.03.
Here's where the markets stand at mid-day:
NYSE Composite Index down 52.33 (-0.70%) to 7,419.06
Dow Jones Industrial Average down 37.08 (-0.30%) to
S&P 500 down 7.30 (-0.56%) to 1,306.02
NASDAQ Composite Index down 21.91 (-0.77%) to 2,815.45
Nikkei 225 down 1.05%
Hang Seng Index down 0.32%
Shanghai China Composite Index down 0.52%
FTSE 100 up 0.18%
NYSE SECTOR INDICES
NYSE Energy Sector Index down 1.47% to 11,097.49
NYSE Financial Sector Index down 0.23% to 4,175.4639
NYSE Healthcare Sector Index down 0.31% to 7,033.16
(+) MVIS (+41.4%) Receives $4 million in purchase orders from
(-) AONE (-5.3%) Warns needs new funding to continue as a going