UPDATE 5-McDonald's U.S. sales show consumer pullback

(Recasts; adds investor comment, details on competitors, byline; updates share activity)

By Lisa Baertlein and Brad Dorfman

LOS ANGELES/CHICAGO, April 22 (Reuters) - McDonald's Corp (MCD.N: Quote, Profile, Research) on Tuesday posted its first monthly sales decline at established U.S. restaurants in five years, overshadowing strong overseas sales that produced higher-than-expected first-quarter profit.

The March U.S. sales drop sent McDonald's shares 1.3 percent lower in afternoon trade and dragged down stocks in the fast-food sector, which had been somewhat insulated from the U.S. economic slowdown as cash-strapped consumers moved to cheaper restaurants.

Shares of fast-food rival Burger King Holdings Inc (BKC.N: Quote, Profile, Research) fell 4 percent, while Yum Brands Inc (YUM.N: Quote, Profile, Research) and Wendy's International (WEN.N: Quote, Profile, Research) each shed just over 2 percent.

Janna Sampson, co-chief investment officer at Oakbrook Investments in Lisle, Illinois, said McDonald's usually posts the industry's strongest numbers and noted that company executives said it gained market share during the first quarter.

"That doesn't bode well for the other guys," Sampson said.

McDonald's said sales at its U.S. restaurants open at least 13 months rose 2.9 percent in the first quarter but fell 0.8 percent in March. Overall same-store sales rose 3.3 percent in the 2007 fourth quarter.

The March decline "certainly speaks to a challenging industry sales environment and a modest deceleration at (McDonald's)," Goldman Sachs analyst Steven Kron said in a client note.