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U.S. stocks slide on disappointing GDP data

Xinhua, May 30, 2015 Adjust font size:

U.S. stocks extended losses in the morning session on Friday, as the second estimate of U.S. first- quarter gross domestic product (GDP) came out negative.

At midday, the Dow Jones Industrial Average dipped 88.15 points, or 0.49 percent, to 18,037.97. The S&P 500 lost 7.96 points, or 0. 38 percent, to 2,112.83. The Nasdaq Composite Index was down 13.54 points, or 0.27 percent, to 5,084.43.

U.S. Commerce Department announced Friday that the second estimate of real GDP decreased at an annual rate of 0.7 percent in the first quarter of 2015, in contrast to the first estimate of a 0.2 percent expansion.

The decrease in real GDP in the first quarter primarily reflected negative contributions from exports, nonresidential fixed investment, and state and local government spending that were partly offset by positive contributions from personal consumption expenditures, private inventory investment, and residential fixed investment, according to the Commerce Department.

"Demand collapsed in the first quarter. Not only was GDP down 0. 7 percent, final sales fell 1.1 percent. The strong dollar and weak overseas demand have caused exports to drop two quarters in a row while imports continue to grow," said Chris Low, chief economist at FTN Financial, in a note.

Lack of resolution on Greece debt talks weighed on Wall Street sentiment as well. International Monetary Fund Chief Christine Lagarde told a German newspaper that a Greek exit is a possibility, and that it would "probably not" mean the end of the euro. Endite