U.S. Stocks Dip As Lower Crude Partially Offsets Weak Data
NEW YORK (MarketWatch) -- U.S. stocks on Tuesday mostly lost their grasp on early gains as a drop in crude-oil prices only partially offset mostly bleak data on housing prices and consumer confidence.
"We expect these weak confidence numbers to show through in feeble consumer spending going forward, despite the fact that stimulus checks are in the mail," said David Rosenberg, Merrill Lynch's North American economist.
After rising more than 50 points, the Dow Jones Industrial Average fell 12.54 points to 12,467.09, with 16 of its 30 components posting losses, led by General Motors Corp. , down 3.4%, and oil giants Exxon Mobil Corp. and Chevron Corp , both down more than 1%.
The S&P 500 fell 0.39 points to 1,375.54, with information technology fronting sector gains, up 0.6%, and materials leading its declines, down 0.9%.
The technology-laden Nasdaq Composite rose 7.34 points, or 0.3%, to 2,452.01.
On the New York Stock Exchange, volume approached 438 million, with decliners edging ahead of advancing stocks. On the Nasdaq, 316 million shares were exchanged, and advancers stayed just ahead of decliners.
Consumers not so confident
The Commerce Department reported sales of new homes climbed in April for first time in six months, but economists said the gain was a rebound from a sharp drop the prior month and doesn't mark a turning point for the embattled housing market. .
Other economic gauges had the Conference Board reporting U.S. consumer confidence fell in May to a 16-year-low, as inflation expectations climbed along with gas prices. .
Before the bell, stock futures offered little reaction to the steepest drop in the 20-year history of the Case-Shiller home price index. The data released by Standard & Poor's had homes prices dropping 14.4% in the year through March. .
"The data reinforce the assumption of growing U.S. consumer angst in the face of soaring food and energy prices, and continued weakness in the housing market," said analysts at Action Economics.
The upbeat start for equities comes in the wake of heavy losses last week, with the Dow shedding nearly 4% of its value in what was the blue-chip benchmark's worst showing since February.
Commodities trade had crude and gold futures falling, with the front month for crude oil falling $1.39 to $130.80 a barrel , while the gold contract for June delivery moved down $16.8 to $909 an ounce. .
In corporate developments, Vodafone Group PLC said CEO Arun Sarin will step down in July after a five-year tenure, with the world's largest mobile operator also reporting a record annual profit of more than $13 billion. .
Shares of Standard Pacific Corp. soared 55% on word a private-equity group had agreed to invest more than $530 million in the home builder.
J.P. Morgan Chase & Co. , part of the Dow industrials, was up 1.1% after the financial institution and First Data Corp. said they had reached terms on ending their joint payments and merchant acquiring venture by the end of the year.
In overseas trading, markets ended mostly higher in Asia, with Toyota Motor Corp. among those gaining in Tokyo.
By Kate Gibson