Retail boost helps lift S&P 500

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NEW YORK (Businesshala) – US stocks closed higher on Tuesday as Home Depot and retail sales data indicated solid consumer health and eased concerns about the Federal Reserve becoming more aggressive in the face of rising inflation.

FILE PHOTO: People walk near the New York Stock Exchange (NYSE) in Manhattan, New York City, US, August 9, 2021. Businesshala/Andrew Kelly

Data showed retail sales rose 1.7% in October, the biggest gain since March and well above estimates of 1.4%, indicating that Americans are busy holiday shopping in an effort to avoid shortages of goods amid extended supply chains. has started.

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Retailer Home Depot Inc. jumped 5.73% to close a record high and its biggest one-day percentage gain since April 2020, beating quarterly sales estimates of nearly $2 billion and on top of earnings per share.

“It gives people a sigh of relief that the retail outlook is still very good,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments in Menomonee Falls, Wisconsin.

“The outlook is one where prices are going up but consumer spending is still strong and there seems to be an emphasis on the supply chain but still we are able to get stuff on the shelves.”

The Dow Jones Industrial Average rose 54.77 points, or 0.15%, to 36,142.22, the S&P 500 rose 18.1 points, or 0.39%, to 4,700.9 and the Nasdaq Composite rose 120.01 points, or 0.76%, to 15,973.86.

The S&P consumer discretionary sector climbed 1.38% and was the best performer among 11 major S&P sectors, while the S&P 500 retail index rose 1.24% to close at a record high for the second straight session.

Walmart Inc., the nation’s largest brick-and-mortar retailer, raised its annual sales and profit forecast. However, its shares gave up early gains, and fell 2.55%, their biggest daily percentage drop since May, as the supply-chain eroded margins and weighed on the consumer staples sector.

Retailers Target Corp., Macy’s Inc. and Kohl’s Corp. are set to report earnings this week.

Other data for the day showed US manufacturing output hit a two-and-a-half-year high in October.

The positive data helped investors look past comments from St. Louis Federal Reserve Chairman James Bullard, who called for a more drastic stance by the central bank in response to rising inflation.

In contrast, San Francisco Federal Reserve Bank President Mary Daly on Tuesday called for the central bank’s patience in the face of high inflation, which she predicted would likely fade on its own as the pandemic progresses.

Investors are also eyeing the possibility that President Joe Biden could choose a new head of the Federal Reserve as Chair Jerome Powell’s term ends in February 2022, Biden said on Tuesday afternoon, adding that he would make a final decision in about four days. Will take

Technology shares also rose 1.07%, with chipmaker Qualcomm Inc gaining 7.89%, which rose after German automaker BMW used its chips in its next-generation driver-assistance and self-driving systems.

Electric-car maker Tesla Inc posted its first advance in four seasons, even as CEO Elon Musk sold $930 million in shares. The stock was down more than 15% last week after Musk began selling shares.

JPMorgan Chase & Co. also sued Tesla for $162.2 million for breach of contract related to stock warrants.

The decline of issues leading to a 1.22-to-1 ratio on the NYSE; On the Nasdaq, a 1.14-to-1 ratio favored the downside.

The S&P 500 posted 80 new 52-week highs and 3 new lows; The Nasdaq Composite recorded 152 new highs and 189 new lows.

Volume on US exchanges stood at 10.53 billion shares, compared to an average of 11.02 billion for the full session over the past 20 trading days.

Reporting by Chuck Mikolajk in New York; Editing by Matthew Lewis

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