TREASURIES-After gain, bonds fall as stocks end higher

(Updates prices, adds comment, changes byline)

* Bonds end lower as stocks erase most losses

* Consumer gloom lifted bond prices early

* Year-end U.S. rate hike still priced in

* Housing starts gain due to volatile multi-family units

By Ellen Freilich

NEW YORK, May 16 (Reuters) - Treasury debt prices ended lower on Friday after erasing an early gain scored on news that consumers' mood soured in the first half of May.

Since consumer spending accounts for about two-thirds of U.S. economic activity, and consumers' perceptions about their present and future financial situation influences their willingness to spend, economists and financial markets pay attention to measures of consumer sentiment and confidence.

The news on consumers' sense of gloom helped Treasuries trade in the plus column for much of the session, based on the notion that prospects for continued economic weakness would temper inflation and make the Federal Reserve less likely to raise interest rates later this year.