Stocks Dip After GDP Report Disappoints

By David K. Randall

January 28, 2011 at 06:33 AM

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NEW YORK (AP) — Stocks fell in early trading Friday after a report showed that the U.S. economy isn't growing as quickly as economists expected.

The Commerce Department said Friday that gross domestic product (GDP) grew at an annual rate of 3.2% between October and December. That's up from 2.6% in the previous quarter, but below the 3.5% analysts had forecast.

Disappointing corporate news was also sending stocks lower. Ford Motor Co. lost 10% after its earnings fell short of Wall Street's projections. Amazon.com Inc. fell 7.5% after reporting that higher costs cut down its profit margins.

The Dow Jones industrial average fell 13 points, or 0.1%, to 11,977 in morning trading. The Standard & Poor's 500 index fell 3, or 0.2%, to 1,297.

Microsoft Corp. fell 3% after reporting late Thursday that the profitability of its Windows division was falling.

Financial companies gained 0.25%, the best performance among the 10 company groups that make up the S&P index. Telecommunications companies fell the most, 0.9%.

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