Holiday shopping season helps Dow climb
Wall Street finished the week with moderate gains today, extending a November rally in light post-Thanksgiving trading amid signs of a strong start to the busy holiday shopping season.
The major indexes ended their fifth winning week in a row and pushed past four-year highs.
Share prices continued their month-long advance, fuelled by an improving economic backdrop and high hopes for solid retail sales that helped cast aside fears of a downturn.
A spirited beginning to the critical holiday sales period today stoked investor optimism, traditionally one of the busiest shopping days of the year as retailers lure customers with bargains and huge discounts. Early reports suggest stores will be more crowded than last year.
The US markets were closed yesterday for Thanksgiving, and logged a shortened session today. Volume was light with many traders out of the office for a second day.
The Dow Jones industrial average gained 15.53, or 0.14%, to close at 10,931.62.
Broader stock indicators were also higher. The Standard & Poor’s 500 index was up 2.64, or 0.21%, at 1,268.25, and the Nasdaq composite index rose 3.03, or 0.13%, to 2,263.01.
Bonds advanced, with the yield on the 10-year Treasury note sliding to 4.43% from 4.47% late on Wednesday. The dollar was mixed against other major currencies in European trading, and gold prices were little changed.
Many investors are anxiously awaiting holiday sales figures for indications of how consumers have handled the recent rise in petrol prices. Wall Street found some encouragement earlier this week, when the University of Michigan reported a better-than-expected jump in consumer confidence.
But a raft of key economic reports are due next week, including data on economic growth, personal spending and employment. While positive figures will probably bolster Wall Street’s year-end rally, any bad news could unnerve a jumpy market and cause it to surrender this month’s gains.
For the week, the Dow gained 1.54%, the S&P 500 advanced 1.6% and the Nasdaq rose 1.61%. So far this year, the Dow is up 1.38%, the S&P 500 has grown 4.03% and the Nasdaq is 4.65% higher.
Today’s frenzied start to the shopping season – known as ”Black Friday,” when retailers begin turning profits – lifted the retail sector as consumers made an early morning rush for malls and stores. Electronics are again expected to be top sellers this year, such as Apple’s iPod media player.
Electronics retailer Best Buy added 1.63 to 50.63, and Apple gained 2.23 to 69.34. Target rose 13 cents to 55.23, Kohl’s climbed 13 cents to 49.20 and JC Penney was up 11 cents at 54.10.
Meanwhile, some other retailers did not fare so well, with Wal-Mart falling 8 cents to 50.49 and Sears Holding off 2.02 at 119.15.
Elsewhere, Taser International said it has been notified by the Nasdaq Stock Market that its shares could be delisted because the stun-gun maker failed to submit its third-quarter financial report on time. Taser sank 90 cents to 6.50.
Starwood Hotels & Resorts Worldwide yesterday said it bought Le Meridien brand and the related management and franchise business for the portfolio of 130 hotels and resorts for 225m (-191m). Starwood rose 7 cents to 61.92.
Advancing issues led decliners by 3 to 2 on the New York Stock Exchange, where volume totalled 542.7m shares. Light volume has persisted all week ahead of Thanksgiving.
The Russell 2000 index of smaller companies rose 0.44, or 0.06%, to 683.58.
