The US stocks raised yesterday on better than expected economic data. The S&P 500 index gained highest percentage since January this year, offsetting a three day decline. There also was some speculation of whether Federal Reserve plans to tolerate record low interest rates.
The S&P 500 benchmark index rose by 1.5%, Dow Jones Average Index gained 1.2%. Retail sales reported 0.6% increase. Initial jobless claims report showed a decrease by 12 000 which is better than estimate. All 10 industries recorded jumps in share price. Financial and consumer companies climbed the most recording gains of more than 1.8%.
“We had a decent jobless-claims number and retail sales were pretty solid,” Matt Kaufler, portfolio manager at Federated Investors said for The Wall Street Journal. “Both are very encouraging signs of the ongoing mending of the U.S. economy, which helped negate concerns about what happened in Japan overnight.”
Investors have been analyzing recent economic data trying to predict Feds reaction to positive economic changes. Feds Chairman Ben Bernanke said earlier last month that central bank may reduce the bond-buying program if the US market shows positive data sustainability.
“The economy around the globe is slowing down so U.S. investors are certainly watching the data and hopefully see signs that the U.S. is not joining their friends in Europe and emerging markets,” Wayne Wilbanks, chief investment officer at Wilbanks said for Bloomberg.
In corporate news, Garnett Co. Inc surged 34%. The media holding purchased television company Belo for about $1.5 billion. Safeway, the US supermarket chain, added 7.4% after selling its Canadian operations to Sobeys for about $5.7 billion. The US company said it would pay debt and buy back stocks. PVH, second largest clothing company raised 10% after reporting better than estimate earnings.
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