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Some indicators point to ‘sluggish’ start to quarter

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U.S. factory output slipped for the first time in 10 months in April as a shortage of parts from Japan slowed activity while home building slumped, showing the economy got off to a weak start in the second quarter, Reuter reported.

Signs of lackluster economic activity were also evident in corporate results today from Wal-Mart Stores Inc. and Home Depot Inc., both of which reported a drop in sales.

“It’s a sluggish start,” said Ryan Sweet, senior economist at Moody’s Analytics, in an interview with Reuters. “Since the beginning of the year, the recovery seems to have hit a bit of a soft patch, but conditions should improve for the remainder of this year.”

Manufacturing output fell 0.4 percent in April, breaking nine straight months of gains, as supply disruptions caused by Japan’s earthquake hit auto production.

A separate report from the U.S. Department of Commerce showed that groundbreaking for new housing dropped 10.6 percent to an annual rate of 523,000 units as a surplus of homes on the market discouraged new projects.

Analysts are still hoping the economy will regain speed this quarter after growth slowed to a 1.8 percent annual pace in the January-March period.