Wall Street rallies as retail sales soothe slowdown fears
Jobless claims at one-month low; retail sales surge in July
Walmart advances after raising FY profit forecast
Cisco gains after forecasting upbeat Q1 revenue, cutting 7% jobs
Indexes up: Dow 1.37%, S&P 500 1.61%, Nasdaq 2.33%
Updated as of 2:30 p.m. ET
By Abigail Summerville
Aug 15 (Reuters) -Wall Street's main indexes jumped on Thursday, with the Nasdaq rising more than 2% after July U.S. retail sales data signaledresilient consumer spending, allaying fears of an imminent recession in the world's largest economy.
Nine of the 11 major S&P 500 sectors tradedhigher, with consumer discretionary .SPLRCD and technology .SPLRCT rising 3.1% and 2.3%,respectively.
Retail sales increased 1.0% last month after a downwardly revised 0.2% drop in June, easing fears of a sharp economic slowdown fanned by a jump in the unemployment rate last week.
Retail bellwether Walmart WMT.N added 6.5% after raising its annual profit forecast for the second time this year as Americans flocked to its stores for inexpensive essentials.
Rival Target TGT.N also jumped 3.6%, while Costco COST.O advanced 1.5%.
A separate reading also showed the number of Americans filing new applications for unemployment benefits fell unexpectedly last week.
"The wall of worry is beginning to crumble as sentiment is improving and the fundamentals support a risk-on bias," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. "Retail sales were above expectations, Consumer Price Index numbers came in at a tolerable level, so the fundamental backdrop is consistent with rising equity prices."
The yield of two-year US2YT=RR and 10-year US10YT=RR Treasury notes rose after the data, with traders increasing bets for a 25-basis-point rate cut by the Federal Reserve to 76.5%, versus 65% before the data. 0#FEDWATCH
Investors have cautiously eyed this week's economic data releases, the last set before Fed Chairman Jerome Powell delivers a much-awaited speech at Jackson Hole next week.
The S&P 500 .SPX and Nasdaq .IXIC extended their winning streaks six consecutive sessions.
As of 2:45 p.m. ET, the Dow Jones Industrial Average .DJI rose 547.87 points, or 1.37%, to 40,556.26, the S&P 500 .SPX gained 87.94 points, or 1.61%, at 5,543.15 and the Nasdaq Composite .IXIC advanced 401.03 points, or 2.33%, to 17,593.63.
Among other movers, Cisco Systems CSCO.O rose 6.9% after it forecast better-than-expected first-quarter revenue and said it was cutting 7% of its global workforce.
Nike NKE.N climbed 4.6% as billionaire investor William Ackman built new stakes in the sportswear company. Ulta Beauty ULTA.O jumped 11.6% after Warren Buffett's Berkshire Hathaway BRKa.N acquired a stake in the cosmetics store chain.
U.S. equities outperform global market so far this year https://tmsnrt.rs/3YLdRPB
Reporting by Abigail Summerville in New York; Editing by Richard Chang
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
