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While you were sleeping: US consumer less confident

While you were sleeping: US consumer less confident

Nov. 26 (BusinessDesk) - Wall Street fluctuated, with the Standard & Poor’s 500 Index touching a record high, as a report showing the US economy grew more than initially forecast in the third quarter offset data showing an unexpected drop in American consumer confidence.

A Commerce Department report showed third-quarter gross domestic product expanded at a 3.9 percent annual pace, up from a previous estimate of 3.5 percent.

"This report will go some way in providing further confirmation about the sustainability of the current economic recovery," Millan Mulraine, deputy chief economist at TD Securities in New York, told Reuters.

Even so, a separate report showed consumer confidence slid to 88.7 this month, down from a revised 94.1 in October.

“Consumer confidence retreated in November, primarily due to reduced optimism in the short-term outlook,” Lynn Franco, director of economic indicators at The Conference Board, said in a statement.

“Consumers were somewhat less positive about current business conditions and the present state of the job market; moreover, their optimism in the short-term outlook in both areas has waned. However, income expectations were virtually unchanged and gas prices remain low, which should help boost holiday sales.”

Pending Black Friday sales later this week will provide an even more current read on consumer sentiment heading towards the year-end holiday season.

Another report showed the S&P/Case-Shiller index of property values rose 4.9 percent in the twelve months through September, slowing from a 5.6 percent pace in the year ended in August.

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In afternoon trading in New York, the Dow Jones Industrial Average rose 0.11 percent. The Standard & Poor’s 500 Index gained 0.06 percent, while the Nasdaq Composite Index advanced 0.13 percent. Earlier in the session the S&P 500 touched a record high 2,074.21.

In the Dow, gains in shares of United Technologies and those of UnitedHealth, up 2.3 percent and 1.1 percent respectively, outweighed slides in shares of Home Depot and those of JPMorgan Chase, down 1.8 percent and 1.1 percent respectively.

In early trade, shares of Apple edged higher, lifting the iPhone maker’s market cap to more than US$700 billion -- the first company ever to breach that mark. Its shares were down 0.2 percent in afternoon trade. The company is forecasting record sales in the current quarter.

"Valuations are a bit stretched, but as long as fundamentals continue to move forward investors will find a way to keep moving prices higher," Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, Ohio, told Reuters.

Shares of Tiffany & Co rose, last up 2 percent, after the company posted quarterly sales that showed strength in the Americas made up for weakness in Asia.

“We were pleased with overall sales performance, especially in light of economic and geopolitical challenges around the world,” Michael Kowalski, chief executive officer, said in a statement.

In Europe, the Stoxx 600 finished the session with a 0.2 percent increase from the previous close. The UK’s FTSE 100 Index eked out a 0.02 percent gain, France’s CAC 40 added 0.3 percent, while Germany’s DAX Index rose 0.8 percent.

(BusinessDesk)

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