Stocks Waver After Weaker GDP Reading

U.S. stocks wavered in early trading on Tuesday as a weaker reading on economic growth kept investors on edge. The Dow Jones Industrial Average lately fell 9.69 points to 11,537.62. The S&P 500 Index was up 1.33 points to 1,194.31. The Nasdaq Composite Index added 7.42 points to 2,530.56.

The U.S. economy grew at a slightly slower pace than previously estimated in the third quarter, but weak inventory accumulation amid sturdy consumer spending strengthened views output would pick up in the current quarter. Gross domestic product grew at a 2.0 percent annual rate in the third quarter, the Commerce Department said in its second estimate on Tuesday, down from the previously estimated 2.5 percent.

A long-running war between Democrats and Republicans over Bush-era tax cuts doomed the debt supercommittee’s chances of reaching a deal. Efforts to overhaul the tax code may await the same fate as both parties gear up to make taxes a central issue in 2012 elections.

The sovereign credit rating of the United States is under review by Fitch Ratings after a Congressional super committee failed to reach agreement on reducing the nation’s budget deficit. But Standard & Poor’s said the super committee’s lack of accord will not affect its rating on U.S. debt, which it had already downgraded in August.

U.S. regulators have informed Bank of America’s (NYSE:BAC) board that the company could face public enforcement action if they are not satisfied with recent steps taken to strengthen the bank, the Wall Street Journal said.

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