US open: Stocks fluctuate as consumer spending falls and oil rebounds

US stocks fluctuated early on Monday, as investors analysed data on consumer spending, while the prices of oil rebounded.

Just before 10:00 in New York, the Dow Jones Industrial Average was down 21.87 points, while the S&P 500 and the Nasdaq were up 0.22% and 0.7% respectively.

US consumer spending recorded its biggest drop in five years in December, as Americans bought fewer cars and trucks and spent less money on energy, as oil prices tumbled.

Personal spending fell to a seasonally adjusted 0.3% in December, while personal spending increased 0.3%, though both figures were in line with expectations. The saving rate rose from 4.3% to 4.9%, while prices calculated by the personal consumption expenditures index fell 0.2% in December.

Meanwhile, the US manufacturing purchasing managers’ index showed that production levels rose at the fastest pace for three months in January.

At 53.9, the seasonally adjusted index remained well above the neutral 50.0 threshold, but new order volumes increased at a slower pace the first month of 2015 and input prices fell for the first time in two-and-a-half years.

“Manufacturing continued to expand in January, but the sector remains in a lower gear compared to that seen last summer,” said Markit chief economist Chris Williamson.

“Factory output growth and job creation remain well below last year’s peaks, adding to the suspicion that the pace of economic expansion in the first quarter could even fall below the 2.6% rate seen in the final quarter of last year.”

Having surged 8% on Friday, crude prices fell sharply earlier in the day in Asia, after news that Chinese manufacturing contracted in January, before rebounding steadily. West Texas Intermediate rose over 2% to $49.31 a barrel, while Brent crude gained 1.8% to $54 a barrel.

Exxon Mobil rose 0.66% despite reporting its fourth-quarter earnings fell 21% due to lower commodity prices. The biggest US energy company also announced plans to cut its share buyback programme.

Intel Corp fell 0.36% after it agreed to purchase German-based Lantiq, a maker of communication chips, for an undisclosed amount.

The dollar rebounded from a two-week low against the yen. The greenback registered gains against the pound but fell 0.1% against the euro, while gold futures fell 0.6% to $1,270.50.