Jun 13, 2014 12:44 Stocks fall in afternoon trading; oil prices surge Stocks fall in afternoon trading; oil prices surge In this Feb. 10, 2011, file photo, American flags fly in front of the New York Stock Exchange in New York. Asian stock markets fell for a second day Thursday June 12, 2014, and European shares drifted as a dimmer outlook for global growth this year gave investors a reason to lock in recent gains. (AP Photo/Mark Lennihan, File) BERNARD CONDON| AP Business Writer June 13, 2014 Comments NEW YORK (AP) — U.S. stocks are falling in Thursday afternoon trading on disappointing economic news and a surge in the price of oil amid escalating violence in Iraq. Airline stocks are down sharply because of higher crude prices. KEEPING SCORE: The Dow Jones industrial average fell 115 points, or 0.7 percent, to 16,728 as of 2:40 p.m. Eastern time. The Nasdaq slipped 41 points, or 1 percent, to 4,290. The Standard & Poor’s 500 index was down 15 points, or 0.8 percent, to 1,928. A lower S&P 500 at the close would make three down days in a row for the broad index. The last time that happened was two months ago. NEWS ON THE ECONOMY: U.S. retail sales rose for a fourth straight month in May, but the growth was slightly below economists’ forecasts. The Commerce Department said consumer spending rose 0.3 percent last month, helped by a surge in auto demand, but shy of the 0.4 percent increase that economists expected. The Labor Department said that weekly applications for unemployment benefits rose 4,000 to a seasonally adjusted 317,000. THE QUOTE: “The data today was a little unfulfilling,” said Lawrence Creatura, a portfolio manager at Federated Investors. Still, he’s optimistic in the face of selling today, partly because he believes the job market will continue to strengthen. “We’re definitely not flinching. We’re holding our positions.” NO-GO YOGA: Lululemon Athletica fell $6.82, or 15 percent, to $37.48 after reporting first-quarter profit tumbled 60 percent, stung by a one-time tax adjustment. The Canadian yoga-clothing company also lowered its full-year earnings forecast. RESTORATION RISE: Restoration Hardware jumped $9.01, or 13 percent, to $80.36 after the furniture and housewares company reported stronger-than-expected results in its fiscal first quarter and raised its outlook for the year, topping Wall Street’s prediction. POWER SURGE: Energy stocks rose broadly after insurgents captured two cities in Iraq, raising the specter of disrupted global oil supplies. The price of oil rose $1.77, or 1.7 percent, to $106.17. Diamond Offshore Drilling climbed $1.86, or 4 percent, to $48.74, making it the second-biggest gainer in the S&P 500 index. Among the 10 sectors in the S&P 500 only energy and utility companies were trading higher for the day. AIRLINES PLUMMET: A combination of higher oil prices and a warning by Lufthansa of smaller profits due to weaker passenger demand helped push airline stocks down sharply. Delta Air Lines fell $2.56, or 6 percent, to $38.15, the most in the S&P 500 index, followed by Southwest Airlines, which dropped $1.36, or 5 percent, to $25.59. United Continental slid $3.24, or 7 percent, to $42.02. BONDS: The yield on the 10-year Treasury note, which moves in the opposite direction to its price, slipped to 2.58 percent from 2.64 percent on Wednesday.