U.S. stocks fell as a drop in holiday spending by consumers drove down chipmakers and some retailers, offsetting gains by automakers after the Federal Reserve allowed GMAC LLC to convert into a bank, Bloomberg reported.
Nvidia Corp., which makes graphics semiconductors for Apple Inc. laptops, fell 4.4 percent after SpendingPulse data showed electronics and appliance sales tumbled 27 percent in November and December from the year-earlier period. Macy's Inc., the second-largest U.S. department-store company, fell 4.2 percent as apparel sales fell about 20 percent. New York Times Co. retreated after the Wall Street Journal reported it's seeking a buyer for its stake in the Boston Red Sox.
"This consumer recession is going to be deep and wide," said Ralph Shive, the South Bend, Indiana-based manager of the $800 million Wasatch 1st Source Income Equity Fund. "It's truly a period of survival of the fittest."
The Standard & Poor's 500 Index fell 0.1 percent to 867.35 at 12:50 p.m. in New York after gaining as much as 0.6 percent earlier. The Dow Jones Industrial Average added 2.62 points, or less than 0.1 percent, to 8,471.10. Energy shares rose, limiting the benchmarks' declines, as crude oil rose more than 4 percent after the United Arab Emirates said it would reduce production to comply with OPEC's supply curbs.
Markets were closed in western Europe, Canada, Australia, Hong Kong, New Zealand and the Philippines, while yesterday and today were Japan's two slowest full days of trading in the past five years. About 3.64 billion shares changed hands in the U.S. on Dec. 24, the least since Dec. 26, 2003, as trading on the New York Stock Exchange and Nasdaq Stock Market ended three hours early before the Christmas holiday.