Stocks slip at open

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Issue #1: America's Money - Everyday on CNN

NEW YORK (CNNMoney.com) -- Stocks slipped Friday morning as oil prices spiked and a report showed a surprisingly steep drop in personal income, raising worries about a bigger consumer spending slowdown.

The Dow Jones industrial average (INDU), the broader Standard & Poor's 500 (SPX) index and the Nasdaq composite (COMP) all declined in the early going.

Oil prices were up $2.46 a barrel to $118.05 as Gustav whipped Jamaica, heading in the direction of the Gulf of Mexico. Some investors fear that the storm could disrupt oil platforms in the Gulf, which accounts for 25% of the U.S. crude supply.

This follows a stock market rally on Thursday, spurred by an unexpectedly strong economic reading for the second quarter and a flattening in oil prices.

Economy: The Commerce Department said that the tightening economy caused personal income to plunge in July by 0.7%. This is more than triple the 0.2% decline expected by a consensus of economists. During the prior month, personal income edged up 0.1%.

The department also released its July figure for personal spending, which rose by 0.2%, matching expectations from economists. In June, spending jumped by 0.6%, partly because of the government-issued stimulus checks.

Later on Friday morning, two other economic reports could move the markets.

At 9:45 a.m., the Chicago Purchasing Managers Association will release the Chicago PMI, a regional index of manufacturing activity, for the month of August. A consensus of analysts expects the index to decline to 50.0, from the prior level of 50.8.

At 10 a.m., the University of Michigan will release its Consumer Sentiment Index for August. A consensus of analysts expect the index to edge up to 62.0, from the July figure of 61.7.

International markets and currency: Asian markets were up and European markets were mixed. The U.S. dollar was down versus the euro, the Japanese yen and the British pound.

Companies: After Thursday's market close, personal computer maker Dell (DELL, Fortune 500) reported earnings that fell below Wall Street's forecasts. The company reported a 17% plunge in net income for the second quarter despite an 11% jump in sales, as it reduced prices in the face of competitor HP (HPQ, Fortune 500). Dell's stock fell 11% in early trading Friday.