Quantcast
Get breaking news alerts via email

Click here to manage your alerts
In this Tuesday, Nov. 12, 2013, photo, specialist Vincent Surace works at the post on the floor of the New York Stock Exchange that handles Intercontinental Exchange. Asian stock markets sank Wednesday Nov. 13, 2013 after a highly anticipated meeting of Chinese leaders did not announce bold reforms to overhaul a growth model that is running out of steam. European markets were muted. (AP Photo/Richard Drew)
Stock indexes climb back to records after retail boost
First Published Nov 13 2013 08:13 am • Last Updated Nov 13 2013 02:58 pm

New York » Macy’s gave the stock market some early holiday cheer.

Stock indexes climbed back into record territory Wednesday after the department store chain gave an optimistic forecast for holiday sales. Macy’s surged 9 percent, leading strong gains among retailers including J.C. Penney, Nordstrom and Target.

Join the Discussion
Post a Comment

The shopping season is a make-or-break time for retailers because it can account for as much as 40 percent of annual revenue. It also gives investors an indication of where consumer spending, a crucial component of the U.S. economy, is headed.

"When the consumer starts spending, it’s pretty much a rising tide," said Ron Florance, deputy chief investment officer for Wells Fargo Private Bank. "That gives a big lift across the board."

The S&P 500 rose 14.31 points, or 0.8 percent, to 1,782, its 34th record close this year.

The Dow Jones industrial average gained 70.96 points, or 0.5 percent, to 15,821.63, also a record. The Nasdaq composite rose 45.66 points, or 1.2 percent, to 3,965.58, well below its record close of 5,048.52 reached in March 2000.

Macy’s jumped $4.35 to $50.68. Its earnings climbed 22 percent for the quarter ended. Nov. 2. The department store chain, which rose the most in the S&P 500 index, was the first major retailer to report earnings for the quarter.

U.S. stocks started the day lower as investors considered when the Federal Reserve might start reducing its economic stimulus.

The Fed is buying $85 billion of bonds a month to keep interest rates low and support the economy. That has helped drive a rally in stocks this year. Surprisingly strong reports on economic growth and hiring last week have led investors to speculate that the Fed may pare back its stimulus sooner than expected.

"We’re in a pause as everyone waits for more data," said Kate Warne, a strategist at investment adviser Edward Jones.


story continues below
story continues below

Investors will closely follow Thursday’s confirmation hearing for Janet Yellen, who has been nominated to succeed Fed Chairman Ben Bernanke, for clues about when the Fed may begin to pull back its economic stimulus.

Chegg, an online textbook rental company, flopped on its first day of trading, slumping $2.82, or 22.6 percent, to $9.68. Another market debut did much better: Extended Stay America, a hotel operator, jumped $3.87, or 19 percent, to $23.87.

In government bond trading, the yield on the 10-year Treasury note fell to 2.73 percent from 2.77 percent Tuesday.

About 90 percent of companies in the S&P 500 have now reported third-quarter results, and earnings are projected to rise by 5.6 percent in the July-to-September period, according to S&P Capital IQ. That’s better than the 4.9 percent growth recorded in the second quarter and better than the 2.4 percent growth in same period a year earlier.

The strong trend in earnings should help the stock market rebound from any weakness caused by concerns that the Fed is set to cut its stimulus, said Dan Morris, Global Investment Strategist at TIAA-CREF, an asset management company.

"What really matters are earnings for corporations," Morris said. "If people focus on that, it’s all pretty good."

In commodities trading, the price of oil rebounded after a slump on Tuesday. Oil rose 84 cents, or 0.9 percent, to $93.88 a barrel. Gold fell $2.80, or 0.2 percent, to $1,268.40 an ounce.

Among other stocks making big moves:

— Potbelly rose $2.52, or 9.3 percent, to $29.58, after its third-quarter earnings came in ahead of market expectations. It was the restaurant operator’s first quarter as a publicly traded company.

— Perry Ellis fell $4.47, or 23 percent, to $15 after lowering its revenue forecast, citing fewer shipments and lower sales through its direct retail channel. The clothing company also cut its full-year forecast.



Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.