NEW YORK (TheStreet) -- Benchmark U.S. stock indices were lower Thursday after a smaller-than-expected rise in consumer spending and an increase in a key inflation gauge.
The Dow Jones Industrial Average was down 0.4% to 16,798.38. The S&P 500 fell 0.4% to 1,951.50. The Nasdaq declined 0.4% to 4,362.22.
As expected, personal income increased by 0.4% in May. Personal spending ticked up a less-than-expected 0.2% vs. the average economist's estimate of 0.4%. The reading, however, rose from April's flat reading.
The core PCE price index rose by an in-line 0.2% month over month, pushing the year-over-year index to 1.5%. These increases arrive after the recent acceleration in the Consumer Price Index.
As inflation concerns pick up, Peter Cardillo, chief market economist at Rockwell Global Capital, acknowledged that inflationary pressure at the producer level has been, in some cases, passed on to the consumer. However, wage inflation remains dormant.
"We reiterate that until higher labor costs become a problem, the chances of the Fed's inflation target being met are still slim," Cardillo said in a note.
Jobless claims dipped by 2,000 in the week of June 21 to 312,000, vs. the consensus estimate of 310,000.