US STOCKS-Wall St slips as energy offsets consumer gains

                                
 * US consumer spending rises modestly in May
                                
 * Drop in U.S. crude hurts energy shares
                                
 * Tobacco stocks climb on U.S. Supreme Court ruling
                                
 * Indexes off: Dow 0.05 pct, S&P 0.2 pct, Nasdaq 0.1 pct
                                
  * For up-to-the-minute market news see [STXNEWS/US]
  (Updates to close, changes byline)
                                
 By Chuck Mikolajczak
                                
 NEW YORK, June 28 (Reuters) - U.S. stocks ended slightly
lower on Monday as gains in consumer-related stocks, including
tobacco shares, were offset by losses in the energy sector.
                                
 Shares of Coca Cola Co <KO.N> and Procter & Gamble Co
<PG.N> were two of the Dow Jones Industrial Average's best
performers. Coca-Cola rose 1.6 percent to $51.08 and P&G gained
1.4 percent to $60.62.
                                
 Consumer shares rose after the government said personal
spending rose moderately in May, exceeding expectations, after
being flat in April. For details, see [ID:nN28253397].
                                
 Tobacco companies rallied after the U.S. Supreme Court
rejected an attempt by the U.S. government to wrest billions of
dollars in damages from the tobacco industry. Altria Group Inc
<MO.N> gained 3.3 percent to $20.34 and Reynolds American Inc
<RAI.N> jumped 4.1 percent to $53.45. The Dow Jones tobacco
index <.DJUSTB> rose 1.8 percent.
                                
 The spotlight, however, was on the consumer as investors
and analysts waited for further evidence that consumer
spending, which accounts for two-thirds of economic activity,
would show greater strength and propel broad growth.
                                
 "What has been driving the market higher has been
expectations that the good manufacturing recovery we've seen is
going to take root and drive the whole economy forward," said
Peter Jankovskis, co-chief investment officer at OakBrook
Investments LLC in Lisle, Illinois.
                                
 "But the big concern there is, the consumer has to be the
one to step up to the plate and make that happen."
                                
 The Dow Jones industrial average <.DJI> dropped 5.29
points, or 0.05 percent, to 10,138.52. The Standard & Poor's
500 Index <.SPX> slipped 2.19 points, or 0.20 percent, to
1,074.57. The Nasdaq Composite Index <.IXIC> shed 2.83 points,
or 0.13 percent, to 2,220.65.
                                
 The S&P Consumer Staples index <.GSPS> advanced 1.1
percent.
                                
 But Wall Street's earlier advance was short-circuited by
weakness in the energy sector, as U.S. crude oil futures fell
as fears Tropical Storm Alex would disrupt production in the
Gulf of Mexico eased. [ID:nN28273380] Exxon Mobil Corp <XOM.N>
shares dipped 1.1 percent to $58.47.
                                
 Among the bright spots in the energy sector, Noble Corp
<NE.N>, owner of the second-largest fleet of offshore drilling
rigs, gained 2.5 percent to $30 after announcing it would buy
Norway's privately held Frontier Drilling for $2.16 billion.
[ID:nSGE65R0FI].
                                
 About 7.08 billion shares traded on the New York Stock
Exchange, the American Stock Exchange and Nasdaq, the lowest
 volume since April 5 and below last year's estimated daily
average of 9.65 billion.
                                
 Declining stocks outnumbered advancing ones on the New York
Stock exchange by 1626 to 1420 while on the Nasdaq there were
1572 declining stocks and 1090 advancers.
 (Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)