NEW YORK (AP) — Stocks are sliding modestly in early morning trading after a new report showed the economy grew at a slower pace in the third quarter than first anticipated.
Investors are entering trading cautiously Tuesday as the updated report from the Commerce Department showed the nation’s economy grew at a 2.8 percent rate in the third quarter, down from an initial estimate of 3.5 percent.
The report provided fresh evidence that the economic recovery will likely be slow and bumpy.
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The Dow Jones industrial average is down 22.98, or 0.2 percent, at 10,427.97. The Standard & Poor’s 500 index is down 2.06, or 0.2 percent, at 1,104.18, while the Nasdaq composite index is down 5.62, or 0.3 percent, at 2,170.39.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.
NEW YORK (AP) – Stock futures are pointing to a mixed opening Tuesday after a new report showed the economy grew at a slower pace in the third quarter than first anticipated.
Investors are entering trading cautiously as the updated report from the Commerce Department showed the nation’s economy grew at a 2.8 percent rate in the third quarter, down from an initial estimate of 3.5 percent – fresh evidence that while a recovery is under way, it is likely to be slow and bumpy.
Economists polled by Thomson Reuters predicted the growth rate would be revised to 2.9 percent.
Slow consumer spending, weakness in commercial construction and the nation’s trade gap all likely contributed to the lower growth expectation.
Consumer spending accounts for more than two-thirds of all economic activity and a rebound in shopping is considered vital for a strong recovery.
Ahead of the opening bell, Dow Jones industrial average futures rose 11, or 0.1 percent, to 10,433. Standard & Poor’s 500 index futures rose 2.20, or 0.2 percent, to 1,106.00, while Nasdaq 100 index futures rose 0.75, or less than 0.1 percent, to 1,792.00.
Overseas markets were mostly lower as China’s central bank warned commercial banks in the country to control their lending.
Investors waiting for further clues about an economic recovery are also getting data on consumer confidence.
A report from the Conference Board is expected to show consumers are still nervous about the economy. The group’s Consumer Confidence Index for November was likely unchanged at 47.7, compared with October. A reading above 90 would signal the economy is on solid footing.
The report is due out at 10 a.m. EST.
A housing report showed home prices improved for the fourth straight month in September, providing further evidence of a modestly improving housing market.
The Standard & Poor’s/Case-Shiller home price index, which tracks prices in 20 major metropolitan markets, rose 0.3 percent in September, compared with the previous month. Prices rose in 11 areas.
The home price report comes a day after an upbeat report on existing home sales in October helped stocks snap a three-day losing streak. A weakening dollar also helped major indexes rally on Monday. Major indexes rose more than 1 percent.
The National Association of Realtors said October home sales rose more than 10 percent, easily topping the 1.4 percent increase predicted by economists.
A weakening dollar has bolstered commodities and stocks of energy and materials companies, helping drive shares higher in recent weeks.
The dollar was mixed Tuesday against other major currencies, while gold prices also rose.
Meanwhile, bond prices rose modestly. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.34 percent from 3.36 percent late Monday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.05 percent from 0.03 percent.
Overseas, China’s Shanghai index fell 3.5 percent, its biggest decline in three months, while Japan’s Nikkei stock average fell 1 percent. Britain’s FTSE 100 rose 0.1 percent, Germany’s DAX index fell 0.1 percent, and France’s CAC-40 declined 0.2 percent.
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