Stocks are trading in a narrow range after the government said the economy grew at a slightly slower pace than expected in the first quarter.
The gross domestic product rose at a 3.2 percent annual rate in the January-March period. Economists forecast GDP would rise 3.4 percent.
Even though the growth rate fell short of expectations, it indicates the economy is recovering. Growth was anchored by a rebound in consumer spending, which is considered vital for a sustained recovery.
In early trading Friday, the Dow Jones industrial average is up 6.20, or 0.1 percent, at 11,173.52. The Standard & Poor's 500 index is down 0.59, or 0.1 percent, at 1,206.19, while the Nasdaq composite index is down 2.48, or 0.1 percent, at 2,509.44.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.
NEW YORK (AP) — Stock futures inched higher Friday after the government said the economy grew at a slightly slower pace in the first quarter than was expected.
The gross domestic product rose at a 3.2 percent annual pace in the January-March period. Economists polled by Thomson Reuters forecast GDP would rise 3.4 percent.
Even though the growth rate fell short of expectations, it is the surest sign yet that the economy is recovering. Growth was anchored by a rebound in consumer spending, which is considered vital for a sustained recovery. Consumers increased spending by 3.6 percent, the biggest jump since 2007 before the
recession began.
It was the third straight quarterly gain in GDP. The economy grew by 5.6 percent during the fourth quarter as businesses restocked inventories and the government spent heavily to stimulate the economy.
Ahead of the opening bell, Dow Jones industrial average futures rose 9, or 0.1 percent, to 11,144. Standard & Poor's 500 index futures rose 0.50, or less than 0.1 percent, to 1,205.80, while Nasdaq 100 index futures rose 4.00, or 0.2 percent, to 2,045.00.
Signs of an improving domestic economy have pushed stocks higher the past two days, after fresh concerns about European debt problems sent shares plummeting on Tuesday. The Dow jumped 122 points Thursday, its biggest jump since March 5, after another batch of strong earnings and a Labor Department report that showed initial claims for jobless benefits fell last week.
In the last trading session of April, the Dow is again set to post a monthly gain. However, unless the Dow can rise by at least 37 points Friday, the index would snap a streak of eight straight weekly gains.
Despite the gains the past two days, investors are still keeping an eye on the European debt problems. The biggest concerns are in Greece, where the country faces loan repayments in a couple of weeks. If it is unable to tap a joint European Union and International Monetary Fund bailout package before May 19, the country could default on its debt.
Analysts fear that debt problems will spread across the continent and stunt a global economic recovery.
Greece, Portugal and Spain all saw their debt ratings slashed by Standard & Poor's earlier this week. Greece's was cut to junk status. Lower ratings make it more expensive to borrow money, which would only add to debt burdens already facing some European nations.
European markets were mixed Friday. Britain's FTSE 100 fell 0.3 percent, Germany's DAX index rose 0.3 percent, and France's CAC-40 fell 0.3 percent.
The euro rose against the dollar, but analysts remain cautious about its long-term future. Some have said that the debt problems could further drive down its value or lead to a split among the 16 countries that share the currency.
In corporate news,
Goldman Sachs Group Inc. is again facing scrutiny. The big Wall Street bank — which is already facing civil fraud charges for misrepresenting details about subprime mortgage securities — is now also facing a criminal investigation.
The Justice Department has opened a criminal investigation against the bank over the mortgage securities deals it arranged. Many blame the credit crisis on the collapse of similar securities which were traded by many banks around the world.
Goldman shares fell $6.79, or 4.2 percent, to $153.45 in pre-opening trading.
Meanwhile, bond prices traded in a narrow range. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.74 percent from 3.73 percent late Thursday.
Gold and oil prices both rose.
