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U.S. Stock Futures Decline After Unexpected Slide in Spending

May 30 (Bloomberg) -- U.S. stock-index futures fell, after the benchmark Standard & Poor’s 500 Index rose to a record, as a report showed an unexpected decline in consumer spending last month.

Lions Gate Entertainment Corp. dropped 6.9 percent after quarterly results missed estimates. Express Inc. fell 13 percent as the retail chain cut its annual profit forecast. Infoblox Inc. sank 32 percent after lowering its full-year projections and saying its chief executive officer will leave. OmniVision Technologies Inc. jumped 10 percent after predicting quarterly earnings will rise more than analysts expect.

Futures on the S&P 500 expiring next month slipped 0.1 percent to 1,915.60 at 8:34 a.m. in New York. Dow Jones Industrial Average contracts lost 15 points, or 0.1 percent, to 16,666 today.

“Growth is coming in as expected and the global economic momentum is gathering pace,” said Michael Morris, head of equities at Mitsubishi UFJ Asset Management in London. “Weather issues have affected the U.S. numbers, but I haven’t seen anything in recent data that makes me question the underlying trends of the economic recovery. There will be bumps along the road, but if nothing really changes the prospects for earnings growth, then valuations are only fair at the moment.”

The S&P 500 yesterday climbed to its highest level on record, taking its 2014 gains to 3.9 percent. The gauge has rebounded 5.8 percent since a selloff in small-cap and Internet shares spread to the broader market and dragged the gauge to a two-month low in April. It has advanced 1.9 percent in May, heading for its fourth consecutive monthly increase.

Slower Spending

Consumer spending unexpectedly fell in April after the biggest surge in almost five years as incomes slowed. Household purchases, which account for about 70 percent of the economy, dropped 0.1 percent, the first decrease in a year, after a revised 1 percent gain the prior month that was the strongest reading since August 2009, Commerce Department figures showed.

Data yesterday indicated the U.S. economy contracted for the first time in three years from January through March as companies added to inventories at a slower pace and curtailed investment. A pickup in receipts at retailers, stronger manufacturing and faster job growth indicate the first-quarter setback will prove temporary as pent-up demand is unleashed.

Federal Reserve policy makers said at their April meeting that the economy has strengthened after adverse weather took its toll. Central-bank stimulus has helped propel the S&P 500 higher by 184 percent from its bear-market low in March 2009. The gauge now trades at 16.3 times the projected earnings of its members, up from a multiple of 14.8 times four months ago.

Consumer Confidence

A final report at 9:55 a.m. New York time may show that consumer confidence in the world’s largest economy fell less than initially estimated, according to economists surveyed by Bloomberg. The Thomson Reuters/University of Michigan sentiment index probably slipped in May to 82.5 from 84.1, which was its highest level in nine months. A preliminary report two weeks ago signaled a drop in confidence to 81.8.

Business activity in the Chicago area expanded in May for a thirteenth straight month, economists predicted. A report at 9:45 a.m. may show that the Institute for Supply Management- Chicago Inc.’s business barometer slid to 61 from 63 in April, which was the fastest pace in six months. A reading above than 50 signals expansion.

Lions Gate, the studio behind “The Hunger Games” movies, slipped 6.9 percent to $27.50. Revenue fell 8.1 percent to $721.9 million for the quarter through March 31, the company said yesterday. Analysts had predicted $823.7 million on average. Adjusted earnings per share were 42 cents, also missing the 43-cent average estimate.

Express Results

Express lost 13 percent to $11.88. The company predicted earnings of 74 cents to 90 cents a share this year, down from a previous forecast of as much as $1.23. First-quarter profit fell to 6 cents a share, missing estimates. The shares have dropped 27 percent in 2014.

Infoblox Inc. sank 32 percent to $13.87. CEO Robert Thomas will leave after almost a decade at the network and data- services provider, according to a statement yesterday. Profit for the 12 months ending July 31 will be as much as 32 cents per share, down from a previous forecast for as much as 34 cents. Sales will probably not exceed $246 million, less than the $252.6 million average analyst estimate.

OmniVision, a maker of image sensors used in mobile phones and security cameras, jumped 10 percent to $22.18. Earnings for the quarter through July may rise to as high as 63 cents a share, more than double the average analyst estimate of 29 cents. Adjusted EPS came at 40 cents for the quarter ended April 30, according to a statement.

Avago Technologies Ltd. added 1.7 percent to $72 after reporting results and saying it will cut 1,100 jobs. Earnings of 85 cents a share and revenue of $701 million for the second quarter exceeded analysts’ projections compiled by Bloomberg. Gross margin rose to 51 percent in the period, from 48 percent last year.

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