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

 


While you were sleeping: US retail sales stall

While you were sleeping: US retail sales stall

Aug 14 (BusinessDesk) - US stocks and bonds gained after weaker-than-expected retail sales data suggested the Federal Reserve might hold off raising interest rates.

American retail sales were flat in July, following a 0.2 percent gain in June, according to Commerce Department data. It was the worst performance since January, showing the US consumer is lacking confidence and that US policy makers might keep rates at record lows for longer.

"It will provide Fed Chair Janet Yellen with some of the rationale she needs to justify why the Fed should move gradually and keep interest rates low for longer than hawks within the Fed would like," Diane Swonk, chief economist at Mesirow Financial in Chicago, told Reuters.

That was considered good news for both Wall Street and US Treasuries. In late afternoon trading in New York, the Dow Jones Industrial Average added 0.48 percent, the Standard & Poor’s 500 Index gained 0.61 percent, while the Nasdaq Composite Index climbed 0.94 percent.

Gains in shares of Intel and UnitedHealth, last up 2.3 percent and 1.4 percent respectively, helped propel the Dow higher.

The US 10-year bond also advanced, pushing its yield four basis points lower to 2.41 percent.

There was more evidence that the US consumer is reluctant to spend. Shares of Macy’s dropped, last down 5.8 percent, after it reported second-quarter sales that fell short of expectations and downgraded its full-year sales outlook.

Shares of other retailers also fell, with Kohl's sliding 2.3 percent and Nordstrom shedding 1.4 percent.

To be sure, some pointed out that they expect the growth in American retail sales to pick up as the labour market gathers steam.

"Given the strong gains in labour market activity, along with other indications of strengthening domestic growth momentum, we expect this slowdown to be short-lived and we look for consumer spending to rebound strongly in the coming months," Millan Mulraine, deputy chief economist at TD Securities in New York, told Reuters.

In Europe, the Stoxx 600 finished the day with a 0.4 percent increase from the previous close, as did the UK’s FTSE 100 Index. France’s CAC 40 gained 0.8 percent, while Germany’s DAX advanced 1.4 percent.

In its quarterly Inflation Report, the Bank of England downgraded its forecasts for wage growth in the UK, and in the process lessened expectations for an imminent rate increase there.

In Greece, the economy shrank 0.2 percent in the three months through June from the same period last year. The contraction was less than expected, and the lowest in nearly six years.

“We’ve had a long-term positive trend,” Christian Schulz, senior European economist at Berenberg Bank in London, told Bloomberg News. “Whether the confidence can be strong enough to push Greece back into strong growth just yet is open to question.”

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Fisheries: Report On Underrsize Snapper Catch

The report found that commercial fishers caught 144 tonnes of undersized snapper in the Snapper 1 area – about 3% of the total commercial catch – in the year ending February 2015. The area stretches from the top of the North Island to the Bay of Plenty and is one of New Zealand’s most important fisheries. More>>

ALSO:

Tourism: China Southern Airlines To Fly To Christchurch

China Southern Airlines, in partnership with Christchurch Airport and the South Island tourism industry, has announced today it will begin flying directly between Guangzhou, Mainland China and the South Island. More>>

ALSO:

Dodgy: Truck Shops Come Under Scrutiny

Mobile traders, or truck shops, target poorer communities, particularly in Auckland, with non-compliant contracts, steep prices and often lower-quality goods than can be bought at ordinary shops, a Commerce Commission investigation has found. More>>

ALSO:

Auckland Transport: Government, Council Agree On Funding Approach

The government and Auckland Council have reached a detente over transport funding, establishing a one-year, collaborative timetable for decisions on funding for the city's transport infrastructure growth in the next 30 years after the government refused to fund the $2 billion of short and medium-term plans outlined in Auckland's draft Unitary Plan. More>>

ALSO:

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news