Wall Street opens lower following pullback in retail sales

NEW YORK (AP) — Stocks are opening lower across the board on Wall Street as traders grapple with a sharp pullback in retail spending last month and new signals from the Federal Reserve that interest rates will need to go higher than previously expected. The S&P 500 was down 1.4% in the early going Thursday, erasing nearly all of its gains from early in the week. The tech-heavy Nasdaq composite was off 1.7% and the Dow was down 1.3%. The government reported that retail sales fell 0.6% from October to November, more than expected. The pullback followed a sharp rise the previous month.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Wall Street was poised to open with losses again on Thursday, one day after a retreat by investors dismayed over the Federal Reserve’s warning that still more interest rate hikes are in store following its latest increase.

Futures for the S&P 500 were down 0.9% and futures for the Dow Jones Industrial Average tumbled 0.7%.

The declines followed the U.S. Federal Reserve’s hike in its key short-term rate by half a percentage point, the seventh increase this year. The Bank of England raised its main lending rate by a half-point Thursday morning and the European Central Bank is expected to follow suit later Thursday with a similar increase.

The U.S. will release Thursday its weekly report on unemployment benefits, along with retail sales data for November. U.S. consumer spending and employment remain strong, hindering the Fed's fight against inflation, but helping protect the slowing economy from a possible recession.

The U.S. central bank’s increase in its key short-term rate by 0.50 percentage points Wednesday was expected. What spooked investors was Fed officials saying they expects rates to climb higher in coming...