U.S. retail sales slipped 0.2% in May, as consumers spent less on gas. April sales were also revised down to a 0.2% drop, marking the first back-to-back monthly drops in two years. Excluding gas, sales were up 0.1%.
Even if cheaper gas is helping consumers, they don’t appear to be spreading their savings throughout the economy. “Today�s report would suggest that consumers pocketed those savings rather than spending more freely on other goods,” wrote Jim Baird, chief investment strategist for Plante Moran Financial Advisors.
The market is taking the sales drop as another bad sign for the U.S. economy, and futures are slipping. In Europe, debt worries continue to sink stocks, with some investors even beginning to question Germany’s strength.
Dow futures fell 34 points; S&P 500 futures fell 5.6 points.
Johnson & Johnson (JNJ) rose 2% after the government approved its plan to acquire device-maker Synthes. Numerous analysts upgraded J&J’s shares on the news.
JPMorgan Chase (JPM) fell 0.4% ahead of CEO Jamie Dimon’s testimony on Capitol Hill. Dimon said in a prepared statement that the company expects to post “solidly profitable” second-quarter earnings results.
Dell (DELL) rose 2.5% after the company initiated a dividend late on Tuesday.
Scotts Miracle-Gro (SMG) plunged 16% after the lawn care company reduced its earnings guidance.
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