Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


While you were sleeping: US consumer spends big

While you were sleeping: US consumer spends big

Jan 15 (BusinessDesk) – Wall Street climbed, while US Treasuries fell, as the all-mighty American consumer showed she is confident enough in the outlook to spend more money than anticipated, bolstering expectations the world’s biggest economy is gathering steam.

US retail sales excluding automobiles, gasoline, building materials and food services, climbed 0.7 percent in December, following a 0.2 percent advance in November, according to Commerce Department data.

The better-than-expected retail sales data, which came hot on the heels of the surprisingly disappointing government non-farm payrolls December data, released last Friday, restored confidence in the acceleration of the US economic recovery.

“The retail sales are painting a better economic backdrop than payrolls did, and investors are using recent weakness as an opportunity to buy," Mike Gibbs, co-head of the equity advisory group at Raymond James in Memphis, Tennessee, told Reuters.

In afternoon trading in New York today, the Dow Jones Industrial Average added 0.53 percent, the Standard & Poor’s 500 Index advanced 0.86 percent, while the Nasdaq Composite Index jumped 1.4 percent. Gains in shares of Intel, last up 3.4 percent, and those of Microsoft, last up 2.2 percent, propelled the Dow higher.

US Treasuries, however, fell, pushing yields on 10-year bonds three basis points higher to 2.86 percent.

“Another strong data point adds additional credence to the idea the monthly jobs report was an aberration,” Dan Greenhaus, chief global strategist in New York at BTIG, told Bloomberg News. “While one number shouldn’t move the discussion in either direction, a strong retail sales report is much better than a weak one.”

The Fed last month decided to reduce its monthly bond-buying program to US$75 billion this month, from US$85 billion previously. And further easing is ahead, if Fed Bank of Philadelphia President Charles Plosser has his way.

“Chairman Ben Bernanke indicated in his December press conference that if we are making progress in terms of inflation and continued job gains, then the program would be concluded late in 2014,” Plosser said in a speech in Philadelphia today.

“The December employment report has not changed my belief that the economy has already met the criteria of substantial improvement in labour market conditions,” Plosser said. “So my preference would be that we conclude the purchases sooner than this.”

Plosser also said that “the economy is on firmer footing than it has been for the past several years.”

Shares of JPMorgan eked out a 0.2 percent gain after the company reported a 7.3 percent slide in fourth-quarter profit following legal settlement costs. In the past year, the bank has agreed to pay about US$20 billion to settle numerous investigations into its businesses.

Shares of Wells Fargo added 0.3 percent after its quarterly results, while better than expected, also failed to inspire.

In Europe, the Stoxx 600 Index finished the session with a 0.2 percent gain from the previous close. The UK’s FTSE 100 rose 0.1 percent, while France’s CAC 40 and Germany’s DAX both increased 0.3 percent.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Court Ruling: Kiwifruit NZ Ordered To Consider Collaborative Marketing Proposals

The High Court has told kiwifruit marketer Zespri to reconsider collaborative marketing proposals from Splice Fruit and Seeka Kiwifruit to sell fruit offshore that its board had previously rejected. More>>

ALSO:

Electric Vehicles: No Road User Charges Feature In Govt Package

Drivers of electric vehicles won't have to pay road user charges and will be allowed to drive in bus lanes as part of a new government plan to double EV numbers annually to a target 64,000 by 2021. More>>

ALSO:

Pre-Budget: Computer Emergency Response Team, Assemble!

John Key told the country's first ever Cyber Security Summit in Auckland that the government had earmarked funding set up a national Computer Emergency Response Team to help prevent and act on cyber incidents in partnership with the private sector and other organisations. More>>

ALSO:

Job Cutter Goes: Mark Weldon To Step Down As MediaWorks CEO

“When I joined MediaWorks in August 2014, I had a mandate to lead a significant change programme to bring the business back from receivership into a position where it could once again be a strong competitor in the market, with a sound and sustainable future. It was a big brief, laden with inherent challenges, but I took it in good faith and have dedicated myself fully to the goal since." More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news