Stocks consolidate after Thursday slide
US stocks started the session under pressure, unable to rebound from Thursday’s slide. US stocks are poised to notch up their largest losses of 2013, as the dog days of summer take their toll on investor sentiment. Retailers such as Macy’s (NYSE:M) and Wal-Mart (NYSE:WMT) missed on sales and gave forward guidance that was less than stellar which is weighing on the space and should be a concern to stock investors.
Nordstrom (NYSE:JWN) , which is at the high end of the retail range, also disappointed as it missed expectations on earnings and sales. Nordstrom reduced its full-year earnings outlook to $3.60 to $3.70 from to its prior outlook of $3.65 to $3.80. The company also reduced its same-store sales for 2013 to 2 to 3 percent from to its prior outlook of a 3 to 5 percent gain.
In economic news, US productivity increased by 0.9 percent bucking the trend of a 1.7 percent decline in the prior first quarter according to the Labor Department. The economist had forecast a 0.6 percent climb. Unit labor costs, which measures the increase in wages rose at a 1.4 percent rate, greater than estimated.
In the housing space, housing starts on new homes rose 5.9% from June to an annual rate of 896,000 units, according to the Commerce Department. It was the second rise in three months, putting construction levels nearly 21% higher from a year ago. Starts were driven by apartment construction as opposed to single family homes.
The S&P 500 index was able to hold support near the 50-day moving average near 1655. Negative momentum has accelerated and the MACD is at its lowest level in 3-months. The index generated a signal at the beginning of August, were the spread crossed below the 9-day moving average of the spread.
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