Investing.com – U.S. stocks pulled back from highs on Friday, ahead of the Memorial Day holiday weekend, as investors mulled over the release of mostly upbeat economic data, fuelling expectations that the Federal Reserve would hike rates in June.
The U.S. economy grew faster than initially reported during the first three months of 2017, easing concerns about a potential slowdown in the U.S. economy.
Gross domestic product grew at an annualized rate of 1.2% in the first three months of 2017, according to a survey from the Bureau of Economic Analysis, well above the previous reading of 0.7%, which was the slowest period of economic growth since 2014.
In a separate report, The Commerce Department said durable goods orders fell 0.7% in April after rising 2.3% in March. Economists had expected a 1.2% drop in durable goods order.
The upbeat bout of economic data raised investor expectations of a June rate hike in the wake of the minutes to the Federal Reserve May 2-3 meeting, released on Wednesday, which revealed that some Fed members cautioned that longer-term rate increases would be subject to economic data, showing the dip in first quarter economic growth had been “transitory”.
According to investing.com’s Fed rate monitor tool more than 80% of traders expect the Federal Reserve to hike its benchmark rate in June, compared to below 70% of traders in the previous week.
The energy sector struggled to pare losses, and weighed on overall performance, despite a nearly 2% rise in oil prices.
On the New York Mercantile Exchange crude futures for July delivery gained 1.8% to settle at $49.80 a barrel.
The Dow Jones Industrial Average down at 21,078.33, up 0.02%. The S&P 500 closed roughly flat while the Nasdaq Composite closed at 6120.19, up 0.08%
The ‘Bulls and Bears’ on Wall Street
The top Dow gainers; Walt Disney Company (NYSE:DIS) up 1%, Caterpillar Inc (NYSE:CAT) up 0.6%, while 3M Company (NYSE:MMM) rose 0.5%.
Home Depot Inc (NYSE:HD) down 1.1%, Johnson & Johnson (NYSE:JNJ) down 0.5% and International Business Machines (NYSE:IBM) down 0.5%, were among the worst Dow performers of the session.
The U.S. equity market will be closed on Monday due to Memorial Day.