Stock prices were slightly lower early this afternoon as sliding consumer confidence trumped the latest report on the nation's gross domestic product, which grew at a faster pace than expected.
At 1 p.m., the Dow Jones industrial average was down 18.40 points at 10,457.50.
The Standard & Poor's 500 index shed 2.16 to 1,176.41. The Nasdaq composite index fell 3.69 to 2,103.18.
After a modest opening weekend to the holiday shopping season, a fourth straight monthly decline in the Conference Board's consumer confidence was the last thing investors wanted to see. But analysts weren't overly alarmed by the selling, noting that it seemed relatively controlled and was typical of the sort of pause stocks often see after Thanksgiving and ahead of the seasonally strong month of December.
Brisk consumer and business spending helped the economy grow at an annual rate of 3.9 percent during the third quarter, stronger than previously thought. U.S. exports, buoyed by a weaker dollar, also contributed to overall economic growth.
Some analysts think the economy will expand slightly faster than 4 percent in the current quarter. One of the factors they're keeping an eye on is the impact of high energy prices on economic activity. Oil prices hit a record high of just over $55 a barrel in late October, but skidded recently. Crude futures were up 8 cents today at $49.88 on the New York Mercantile Exchange.
Despite the surge in oil prices, inflation remains under control from an economic point of view. An inflation gauge tied to the GDP report showed prices, excluding food and energy, rose at an annual rate of just 0.7 percent, down from a 1.7 percent growth rate during the second quarter. It was the lowest reading since 1962.
Smithfield Foods rose 50 cents to $28.40. The world's largest hog producer and pork processor posted higher quarterly earnings as sharply improved hog production offset lower pork margins and a modest loss in the beef segment.
J.M. Smucker Co. added 3 cents at $45.40. The company, known for its fruit jams and Jif and Crisco brands, plans to sell its industrial baking and dairy ingredients businesses. It also plans to close a California processing plant and cut other U.S. jobs as part of restructuring efforts.
Blyth Inc. fell 46 cents to $29.41. The largest U.S. candlemaker said a weak retail environment drove its quarterly profits down 13 percent, prompting the company to cut its projected earnings for the year.
Taser International gained $1.60 to $27.06. The company defended its stun gun against calls by Amnesty International to suspend their use until more testing is done to prove that the product is safe.
United Natural Foods rose $1.55 to $27.30. The organic foods distributor's earnings beat estimates by a penny per share, and it raised forecasts for 2005.
American Woodmark gaiend 59 cents to $40.03. The maker of kitchen cabinets and vanities for the remodeling and new home construction markets said quarterly earnings rose 38 percent due to higher sales and reduced labor costs.
An index of retailing stocks fell 1.2 percent, contributing the most to the S&P 500's decline. Wal-Mart Stores dropped 66 cents to $52.49, while May Department Stores Co., the owner of the Lord & Taylor and Hecht's chains, fell $1.01 to $28. Home Depot, the No. 1 home-improvement chain, dropped 39 cents to $42.56.
Financial stocks fell as faster-than-expected economic growth may make it more likely the Federal Reserve will increase interest rates to curb inflation. Bank of America Corp. lost 22 cents to $46.12. Wells Fargo & Co., the No. 4 U.S. bank, lost 44 cents to $61.76. Wachovia Corp., the fifth biggest, dropped 59 cents to $51.71.
Decliners outnumbered advancing issues by about 3 to 2 on the New York Stock Exchange. Volume came to 386.51 million shares, compared to 374.17 million traded at the same point Monday.
The Russell 2000 index, which tracks smaller company stocks, was down 1.44, or 0.23 percent, at 633.02.
Overseas, Japan's Nikkei stock average shed 0.72 percent. In afternoon trading in Europe, France's CAC-40 declined 0.35 percent, Britain's FTSE 100 fell 0.73 percent and Germany's DAX index dipped 0.10 percent.