(Repeats to fix paragraph indentation on paragraph 2)
* Consumer confidence unexpectedly drops in June
* S&P 500 <.SPX> registers best quarter since 1998
* Dow off 1 pct, S&P 500 off 0.9 pct, Nasdaq off 0.5 pct
* For up-to-the-minute market news click []
(Updates to close)
By Ellis Mnyandu
NEW YORK, June 30 (Reuters) - U.S. stocks fell on Tuesday
as an unexpected drop in consumer confidence cooled recent
optimism about an economic recovery, but Wall Street still
closed out its best quarter in a decade.
The drop in the Conference Board's measure of consumer
confidence in June suggested that the 18-month-long recession
had yet to loosen its grip on the U.S. economy. (For details,
see [])
Gloom among consumers is a major obstacle as their
spending is a major driver of corporate profits and accounts
for roughly two-thirds of U.S. economic activity.
Tuesday's standout decliners included industrials, energy
and material stocks, some of the very same sectors that helped
underpin the market's push to recover from the 12-year lows of
early March as investors bet on economic stabilization.
"Consumer confidence is the excuse du jour for the latest
market move," said Tom Alexander, head of Alexander Trading,
in Savannah, Georgia.
"For the market to go much higher, you are going to have
to see some real hard evidence of some of these things that
are being anticipated by the market, start to come to
fruition. Pick one. Are the bank balance sheets really cleaned
up? Nobody knows. The market has gone up on a lot of faith
here."
The Dow Jones industrial average <> slipped 82.38
points, or 0.97 percent, to 8,447.00. The Standard & Poor's
500 Index <.SPX> dropped 7.91 points, or 0.85 percent, to
919.32. The Nasdaq Composite Index <> shed 9.02 points,
or 0.49 percent, to 1,835.04.
Even so, the S&P 500 posted its best quarterly performance
since the fourth quarter of 1998. For the month of June, the
Dow shed 0.6 percent, while the S&P 500 inched up 0.02
percent, and the Nasdaq climbed 3.4 percent.
Since its 12-year closing low on March 9, the S&P 500 is
up 35.9 percent.
Among industrial stocks, shares of Caterpillar Inc
<CAT.N>, a maker of bulldozers and excavators, slumped 4.9
percent to $33.04, while on the technology front,
International Business Machines Corp <IBM.N> tumbled 1.3
percent to $104.42.
On Nasdaq, chip maker Qualcomm <QCOM.N>, off 1.9 percent
at $45.20, was the worst drag.
Sliding oil prices gave investors a reason to sell some
energy shares, with Exxon Mobil <XOM.N> down almost 1 percent
at $69.91.
Crude oil futures <CLc1> fell $1.60, or 2.2 percent, to
settle at $69.89 a barrel.
Shares of U.S. oil refiners such as Sunoco Inc <SUN.N> and
Tesoro Corp <TSO.N> dropped after Goldman Sachs cut them to
"sell" from "neutral." []
Sunoco dipped 0.4 percent to $23.20, while Tesoro declined
1.2 percent to $12.73.
On the final day of the second quarter, money managers set
out to burnish their portfolios by selling losing stocks and
scooping up winners in a move that helped the market end
sharply off its lows.
Volume was on the lighter side due to a holiday- shortened
week. U.S. markets will be shut for the U.S. Independence Day
holiday on Friday.
Tuesday's other economic news were separate reports that
showed U.S. single-family home prices fell in April but the
pace of decline moderated, and business activity in the
Midwest contracted again in June, but at a less severe rate
than expected. []
(Editing by Jan Paschal)
