The stock markets in the United States climbed driven by the positive retail sales data prior to the decision of the Federal Reserve on interest rates.
The Department of Commerce reported that the sales of retail stores and restaurants increased at a seasonally adjusted rate of 0.2% to $447.7 billion in August from the previous month or up 2.2% compared with the same period last year.
Financial analysts said the retail sales data showed consumers are still spending their savings from cheap gas prices although their confidence were impacted by the recent market volatility.
In a note to investors, Jesse Hurwitz, a U.S. economist at Barclays said consumers in the country are “buoyant” and predicted that their spending ould remain strong. “We expect the consumer to remain the dominant force behind the U.S. economic growth,” said Hurwitz.
[drizzle]A separate report indicated that manufacturing sector in New York declined in December. The factory production in the United States dropped the most in August since January last year. Automakers are reducing their production as a stronger dollar weighed on demand from overseas.
Investors are speculating that the Federal Reserve would delay raising interest rates due to concerns that China’s economic slowdown could pressure the global economic growth.
John Canally, chief economic strategist at LPL Financial, told Bloomberg, ““Everybody’s waiting on the Fed. We saw a pretty solid gain in retail sales in August and an upward revision to July. People have been worried about a possible spillover from China, and that’s just not happening.”
(As of 3:30 PM EST)
- Dow Jones Industrial Average (DJIA) – 16, 632.02 (+1.59%)
- S&P 500- 1,982.00 (+1.48%)
- NASDAQ- 4,869.98 (+1.34%)
- Russell 2000- 1,167.25 (+1.19%)
- EURO STOXX 50 Price EUR- 3,207.60 (+1.01%)
- FTSE 100 Index- 6,137.60 (+0.87%)
- Deutsche Borse AG German Stock Index DAX- 10,188.13 (+0.56%)
- Nikkei 225- 18,026.48 (+0.34%)
- Hong Kong Hang Seng Index- 21,455.23 (-0.49%)
- Shanghai Shenzhen CSI 300 Index- 3,152.23 (-3.93%)
Stocks in Focus
(stock prices as of 3:30 PM EST)
The stock price of Microsoft increased more than 2% to $44.17 per share. Piper Jaffray analyst Katherine Egbert noted reports suggesting that Microsoft is considering a bid for Advanced Micro Devices. Egbert maintained her Overweight rating for MSFT with a price target of $53 per share.
The shares of Maxwell Technologies surged more than 16% to $5.96 a piece. The company announced that Continental Automotive Systems’ Maxwell-powered voltage stabilization system (VSS) will become a standard feature on the 2016 Cadillac ATS and CTS sedans as well as the ATS coupes.
United Parcel Service gained more than 3% to $100.75. The company announced its plan to hire as much as 95,000 part-time and full-time workers for the holiday season.