| Business

Larger text Larger text Smaller text Smaller text | Order Photo Reprints

Wall Street catches breath

Email Newsletters

Sign up for one of our email newsletters.

On the Grid

From the shale fields to the cooling towers, Trib Total Media covers the energy industry in Western Pennsylvania and beyond. For the latest news and views on gas, coal, electricity and more, check out On the Grid today.

By The Associated Press
Tuesday, May 14, 2013, 12:01 a.m.

NEW YORK — A record-breaking rally in stocks paused on Monday as investors assessed whether the rise in stock valuations overstated improvements in the economy.

The latest positive data showed that Americans increased spending at retailers last month. That suggests that consumers may boost economic growth in the quarter ending June 30. Still, that wasn't enough to lift shares.

“What we have seen is a huge rally, and there aren't any stones unturned at this point,” said Alec Young, global equity strategist at S&P Capital IQ. “You reach a point where investors aren't willing to bid things up any more.”

Stocks have surged this year, boosted by an improving economy, Federal Reserve stimulus, record corporate earnings and a reviving housing market. The Dow Jones industrial average and the Standard and Poor's 500 index closed at record highs on Friday.

Oil fell 87 cents, or 0.9 percent, to $95.17 a barrel. Gold dropped $2.30, or 0.2 percent, to $1,434.30 an ounce. The dollar was little changed against the Japanese yen at 101.83 and gained against the euro.

Retail sales increased 0.1 percent in April from March, the Commerce Department said. That's an improvement from the 0.5 percent decline in March, which was the largest drop in nine months. Economists had forecast that sales declined by 0.3 percent.

Consumer sentiment is improving as the housing market recovers, which is giving people the confidence to spend more, said Doug Cote, chief market strategist at ING Investment Management.

“If housing continues its upward trajectory, the animal spirits of the consumer will continue to be bolstered,” Cote said.

Stocks started lower, then pared some of those losses throughout the day.

The Dow fell 26.81 points, or 0.2 percent, to 15,091.68. The S&P 500 was little changed at 1,633.77. The Dow is up 15.2 percent this year, and the S&P 500 is 14.6 percent higher.

Telecommunications dropped the most of any sector in the S&P 500 index, falling 0.83 percent. Health care advanced the most, rising 0.7 percent.

Subscribe today! Click here for our subscription offers.



Show commenting policy

Most-Read Business Headlines

  1. Asian bug threatens oranges in Florida
  2. As historic breakup nears, Alcoa works to redefine its ‘advantage’
  3. Batteries key to alternative energy’s success
  4. Make green home upgrades pay off
  5. Older workers try to cut back on hours at job
  6. Program lets public service workers be forgiven for student debt
  7. Paying pals digitally catches on
  8. Travelers contend with increase  in ground delays
  9. Smartphones expected to overtake desktops for holiday shopping
  10. $170.4M AmEx charge yields whopping perk for Chinese billionaire
  11. Shopping beacons join list of ‘next big thing’ disappointments