WASHINGTON (MarketWatch) -- The U.S. economy lost momentum in the second quarter, according to figures released Friday, which may raise concerns of an extended soft patch if not an outright contraction.

Real gross domestic product -- the inflation-adjusted, seasonally adjusted value of all goods and services produced in the U.S. -- rose at a 2.4% annualized rate in the second quarter, well below the average 4.4% increase over the past six months.

The 2.4% increase in GDP was close to the 2.5% expansion expected by economists surveyed by MarketWatch. However, the rate of expansion in the first quarter was revised up to a 3.7% rise compared with the prior estimate of a 2.7% increase. Read full government release.

Economists say the growth was fairly strong in April and May but hit a rough patch in June. So the economy is going into the second half with little momentum.

"The post-recession rebound is history," said Bart van Ark, chief economist at the Conference Board.

"We don't foresee a double dip," he continued, "but we do expect growth to slow even more markedly" -- to what he pegged as a 1.6% annualized rate for the second half of the year. See more reactions.

Stocks opened to the downside, but a report on stronger factory activity in the Midwest helped stocks recoup somewhat. The Dow Jones Industrial Average DJIA, +1.19% was recently down 3 points to 10,462. See Market Snapshot.

Bond investors, confident that the coast remains clear as far as inflation goes, bought U.S. Treasurys as 2-year-note yields sank to record lows. See bond report.

Annual revisions released at the same time as the first estimate for second-quarter GDP show that the Great Recession was deeper than previously thought.

During the recession, real GDP decreased at a 2.8% average rate, down from the prior estimate of a 2.5% rate.

At the same time, the recovery, already one of the slowest, has been a bit slower. From the third quarter of 2009 to the first quarter, the economy grew at a 3.4% annual average rate, just below the previous estimate of a 3.5% increase.

Nigel Gault, chief U.S. economist at IHS Global Markets, said the biggest surprise in the revisions was how much weaker than previously thought consumer spending was.

"The whole trajectory of consumer spending was taken down," Gault said.

The savings rate rose to 6.2%. The weak job market and the debt hangover from the recession are causing consumers to be thrifty, he said. There is also a lack of access to ready credit.

Growth in the third quarter is likely to be even slower than it was the April-June period, he said, and the door for a double-dip recession remains open. See roundup of reactions to GDP

Now that the revisions have been released, the National Bureau of Economic Research may move to make a formal call on the end of the recession. Most economists think the recession ended in June 2009.

Details

Although the increase in GDP in the quarter was not as strong as the one of the first quarter, many details of the report were positive. Much of the deceleration was due to the trade sector.

Final sales, which exclude inventories, rose at a 1.3% rate in the second quarter after rising 1.1% in the first quarter. Consumer spending slowed to an increase of 1.6% after growing at a 1.9% annual pace in the previous two quarters.

Consumer spending added 1.2 percentage points to GDP.

Spending on durable goods rose 7.5%, spending on nondurable goods rose 1.6%, and spending on services increased 0.8%.

Real disposable income rose 4.4%.

Business investments rose at a 17% annual rate in the second quarter after a 7.8% gain in the first quarter. Investments in structures rose 5.2%, and investments in equipment and software rose at a 21.9% pace. Business fixed investment added 1.5 percentage points to growth.

Inventories increased by $75.7 billion. The change in inventories added 1.1 percentage points to growth.

Investments in housing increased at a 27.9% annual rate after falling for the last two quarters. Residential investments added 0.6 percentage point to growth.

Imports grew at a much faster pace the exports during the second quarter. Exports rose at a 10.3% rate. Imports soared at a 28.2% clip, the most in 34 years, as U.S. consumers and businesses stopped buying. Net exports subtracted 2.8 percentage points from growth as the trade gap widened. Imports had a record negative contribution to quarterly GDP.

Final sales to domestic purchasers -- a measure of domestic demand -- rose 4.2% after rising 3.5% in the first quarter.

Government spending rose at a 4.4% annual pace after a 1.6% drop in the first quarter. Spending by state and local governments rose 1.3%. Federal spending rose 9.2%. Government spending added 0.9 percentage point to growth.

The price index for domestic purchases (prices paid by U.S. residents) rose 0.1% in the quarter. Consumer prices also rose 0.1%, while core consumer prices (which exclude food and energy) rose 1.1%.

In current dollar terms, GDP rose 4.1% to an annual rate of $1.23 trillion.

There was a flurry of other reports Friday.

The Labor Department reported that the employment-cost index rose 0.5% in the second quarter, in line with market expectations. The gain was seen as good news. Usually the ECI is watched carefully for signs of inflation but economists are now examining it for signs of deflation and declining wages.

Also, the University of Michigan and Reuters reported that consumer sentiment was softer in July compared with the prior month. See full story.

The Chicago Purchasing Managers index surprised analysts by showing a healthy increase in July. This gain eased some of the gloom from the GDP data.