* Autozone’s weak report weighs on auto part retailers
* Take-Two hits record high on better-than-feared forecast
* April new single-family home sales fall from 9-1/2-yr high
* May manufacturing activity drops to lowest since September
* Dow up 0.19 pct, S&P up 0.14 pct, Nasdaq off 0.03 pct (Adds details, changes comment, updates prices)
By Tanya Agrawal
May 23 (Reuters) - U.S. stocks trimmed their gains on Tuesday morning, weighed down by weak economic data, while investors await more details from President Donald Trump’s first full budget plan aimed at slashing government spending.
Trump is set to propose a raft of politically sensitive cuts, including to healthcare and food assistance programs for the poor, with the aim of chopping government spending by $3.6 trillion and balancing the budget over the next decade.
“Investors are interested simply because it does give an indication where Trump is going to try to influence the agenda and there is some concern over whether he has reduced negotiating power because of his own political difficulties at the moment,” said Lisa Kopp, head of traditional investments at U.S. Bank Wealth Management in Minneapolis.
Congress holds the federal purse strings and often ignores presidential budgets, which are proposals and may not take effect in their current form.
Economic data showed new single-family home sales in April tumbled from near a 9-1/2-year high, while manufacturing activity for May fell to its lowest level since September.
While the job market continues to strengthen, other pieces of data have shown a dip in consumer sentiment and spending, which makes up about two-thirds of U.S. economic activity.
“We’re likely to be in a sideways period in the market for the next few weeks as there are quite a bit of pieces of news the market is digesting including geopolitical developments in Washington and globally,” said Kopp.
At 10:56 a.m. ET (1456 GMT) the Dow Jones Industrial Average was up 39.21 points, or 0.19 percent, at 20,934.04, the S&P 500 was up 3.5 points, or 0.14 percent, at 2,397.52 and the Nasdaq Composite was down 1.80 points, or 0.03 percent, at 6,131.82.
The market also seemed to have shrugged off news of a suicide attack in Britain. U.S. futures had slipped slightly on Monday evening, before recovering, on news of the attack that killed 22 people and wounded many more at a pop concert in the English city of Manchester.
Eight of the 11 major S&P 500 sectors were higher, with the defensive sectors such as utilities and consumer staples leading the gainers.
Consumer discretionary was the biggest laggard with a 0.32 percent drop, as auto part retailers weighed.
Autozone fell 8.5 percent to $603.71 after the auto part retailer’s quarterly results came in below expectations. Advance Auto Parts, O‘Reilly Automotive and Genuine Parts were down between 2.6 percent and 3.9 percent.
Shares of Take-Two reversed course from premarket to rise as much as 11 percent to a record high of $76.70 as the videogame maker’s full-year forecast was not as bad as feared.
Advancing issues outnumbered decliners on the NYSE by 1,607 to 1,124. On the Nasdaq, 1,412 issues fell and 1,213 advanced.
The S&P 500 index showed 40 new 52-week highs and seven new lows, while the Nasdaq recorded 60 new highs and 39 new lows. (Reporting by Tanya Agrawal; Additional reporting by Gayathree Ganesan; Editing by Savio D‘Souza)