Stock Market Today: Markets in the Red Ahead of Jackson Hole

August 30, 2012 at 12:01 PM EDT

Here are the major headlines in the stock market today . Consumer spending gains most in five months- Consumer spending rose for the first time in three months, increasing 0.4% in July from June but slightly below expectations of 0.5%. This follows no change in June and a slight drop in May. The gain was the best in five months for consumer activity which accounts for roughly 70% of the economy. Even though it was a good monthly gain, U.S. consumers' purchases advanced at a 1.7% annual rate in the second quarter, the smallest increase in a year. "The quarter is getting off to a decent start," Gus Faucher, a senior economist at PNC Financial Services Group Inc. told Bloomberg News . "The consumer's situation is slowly improving, but the job growth isn't there to support really big gains in future spending." Jobless claims remain unchanged- The number of people filing for initial unemployment claims matched last week's upwardly adjusted figure of 374,000. Economists on average expected this week's initial claims to be 370,000 and the data suggests that hiring is not improving. The unemployment rate, which moved up to 8.3% in July, has been stuck above 8% for more than three years, the first time this has happened since the Great Depression. To continue reading, please click here...

Here are the major headlines in the stock market today.

Consumer spending gains most in five months- Consumer spending rose for the first time in three months, increasing 0.4% in July from June but slightly below expectations of 0.5%. This follows no change in June and a slight drop in May. The gain was the best in five months for consumer activity which accounts for roughly 70% of the economy. Even though it was a good monthly gain, U.S. consumers' purchases advanced at a 1.7% annual rate in the second quarter, the smallest increase in a year. "The quarter is getting off to a decent start," Gus Faucher, a senior economist at PNC Financial Services Group Inc. told Bloomberg News. "The consumer's situation is slowly improving, but the job growth isn't there to support really big gains in future spending."

Jobless claims remain unchanged- The number of people filing for initial unemployment claims matched last week's upwardly adjusted figure of 374,000. Economists on average expected this week's initial claims to be 370,000 and the data suggests that hiring is not improving. The unemployment rate, which moved up to 8.3% in July, has been stuck above 8% for more than three years, the first time this has happened since the Great Depression.

Jackson Hole Fed meeting kicks off tomorrow- The eagerly awaited symposium starts tomorrow with Federal Reserve Chairman Ben Bernanke speaking at 10 a.m. EDT. Investors will look to clues on whether or not Bernanke will hint at QE3. The latest economic reports are probably not enough to warrant any action and the Fed may wait until the August jobs report is released on September 6 to make a decision. "I don't think he's going to say anything new," Catherine Mann, a finance professor at Brandeis University and former Fed economist who has attended the meeting twice told CNN. The market, which has been quiet all week ahead of Bernanke's speech, will be disappointed if no action is taken. The Fed's next meeting is scheduled for Sep 12-13.

Same-store retail sales beat estimates- A range of retailers including Target Corp. (NYSE: TGT), Macy's Inc. (NSYE: M), The Gap Inc. (NSYE: GPS), Limited Brands Inc. (NYSE: LTD) and Nordstrom Inc. (NSYE: JWN) all beat Wall Street's same-store sales estimates. This was fueled by strong back-to-school sales, which is the second biggest retail season behind the winter holidays.

Pandora Media Inc. (NSYE: P) surges on strong earnings report- Pandora, provider of Internet radio, announced its fiscal second-quarter revenue increased 51% to $101.3 million, beating analysts' expectations of $100.94 million. The company said that it broke even on a non-GAAP basis, ahead of analysts' expectations for a 3 cent loss. Year-over-year mobile revenue increased 86% to $59.2 million and Pandora also increased its third-quarter and full-year forecasts. Listener hours increased 80% from a year ago and its Internet radio market share is up to 72%. "I loved the user metrics given all the hullabaloo of all the competitors," Laura Martin, an analyst with Needham & Co told Reuters. "The mobile revenue is a big deal," she said. Pandora stock is up 18% in early trading.

The Dow Jones today was down 91 points, or 0.70%, and the S&P 500 was down 9.91 points, or 0.70% in early trading.

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