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US markets brace for rate rise

Do Not UseDo Not Use 31/05/2016

(Closed): US markets closed mostly lower as investors weighed the prospect of a Federal Reserve interest rate rise.

The Dow Jones Industrial Average ended 88.69 points lower at 17,784.53, while the S&P 500 index fell 2.17 to 2,096.89

The tech-focused Nasdaq index rose 14.55 to 4,948.05.

On Tuesday, the Commerce Department reported US consumer spending rose by 1% in April, the largest one month rise in over six years.

The strong consumer spending data gave the latest sign of an improvement in economic growth and supported the Federal Reserve's hints about raising interest rates later this year.

Economic data released this week includes the Federal Reserve's Beige Book and factory orders, with May unemployment figures on Friday.

Investors will be looking for signs that the Fed is likely to raise rates at its mid-June policy meeting.

Microsoft was the Dow's biggest gainer for the day, raising 1.3%.

Shares of aircraft maker Boeing fell 2.4%.

On Friday, the aerospace giant said that delivery of the first KC-46 tanker aircraft to the US Air Force would be delayed by five months to August 2017.

US electricity utility Great Plains Energy fell 5.9% after announcing a takeover of Westar Energy for $8.6bn. Westar shares jumped 6.4%.

Oil prices fell 1.4% leaving US crude at $48.91 a barrel and Brent crude at $49.68.

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