Stocks Edge Higher as Retailers Rally 08/16 15:48
U.S. stocks rose slightly Wednesday as Urban Outfitters and Target helped
NEW YORK (AP) -- U.S. stocks rose slightly Wednesday as Urban Outfitters and
Target helped retailers rally. That was enough to cancel out more losses for
Urban Outfitters and Target did better in the second quarter than analysts
expected, and Target raised its forecasts for the year. That helped companies
that sell clothing and other retailers. Technology companies and firms that
make and sell household goods also traded higher.
A wide variety of retailers saw their shares sink the day before based on
weak earnings reports. With Wal-Mart and Ross Stores in line to report their
own results Thursday, investors could change their minds again.
"This sector is not for the faint of heart," said JJ Kinahan, chief
strategist for TD Ameritrade. "The market is trying to figure out who the
winners and losers are going to be."
He said turbulence for retailers will be a constant as online competition
keeps growing and customers want more features like same-day delivery.
The Standard & Poor's 500 index picked up 3.50 points, or 0.1 percent, to
2,468.11. The Dow Jones industrial average added 25.88 points, or 0.1 percent,
to 22,024.87. The Nasdaq composite gained 12.10 points, or 0.2 percent, to
6,345.11. The Russell 2000 index of smaller companies inched up 0.30 points to
Clothing and accessories retailer Urban Outfitters had a better second
quarter than Wall Street expected, and analysts said there are some signs the
company's business is recovering after years of struggles. The stock rose
$2.94, or 17.5 percent, to $19.76. Even with those gains, it's down 31 percent
this year and recently traded at eight-year lows, far below its price of $45 a
share in early 2015.
Target gained $1.96, or 3.6 percent, to $56.31. The company raised its
annual estimates after it did better than analysts expected in the second
Gap climbed 50 cents, or 2.3 percent, to $22.57. Express added 27 cents, or
4.8 percent, to $5.84. Retailers had struggled a day earlier after poor results
and lower forecasts from Dick's Sporting Goods and Advance Auto Parts. The S&P
500 index of retailers climbed 1.7 percent Wednesday after a 2.3 percent plunge
the day before.
Benchmark U.S. crude lost 77 cents, or 1.6 percent, to $46.78 a barrel in
New York. Brent crude, used to price international oils, dipped 53 cents, or 1
percent, to $50.27 a barrel in London. That pulled energy companies down
further. EOG Resources fell $2.04, or 2.3 percent, to $84.98 and Marathon Oil
fell 34 cents, or 2.9 percent, to $11.19.
Energy companies have slumped this month, but their second-quarter profits
have improved dramatically compared to a year ago. A year ago the companies
were struggling to make money thanks to a prolonged slump in oil prices. But
for more than a year, U.S. crude has mostly stayed between $40 and $55 a barrel.
Stocks made bigger gains earlier in the day, but they slipped after a group
of CEOs, including the heads of 3M and Campbell Soup, said they were leaving a
manufacturing jobs group over comments about made by President Donald Trump
about the racially charged violence in Charlottesville, Virginia this past
Trump then tweeted that he is ending that council as well as a strategy and
policy group. The furor could create more obstacles for Trump's pro-business
agenda of tax cuts and infrastructure spending.
The Dow rose as much as 86 points earlier on.
After an early gain, the dollar dipped to 110.16 yen from 110.58 yen. The
euro rebounded to $1.1769 from $1.1734.
Bond prices turned higher. The yield on the 10-year Treasury note fell to
2.23 percent from 2.27 percent.
With bond yields falling, banks and financial companies turned lower as
well. Lower bond yields mean lower interest rates on loans and fewer profits
Lincoln National fell $1.03, or 1.4 percent, to $71.14 and Bank of America
gave up 28 cents, or 1.1 percent, to $24.19. Regions Financial sank 14 cents,
or 1 percent, to $14.34.
The minutes from the Federal Reserve's meeting last month did not include
many details about the central bank's plans for letting its balance sheet
shrink. The notes showed a divided Fed, as some members of its policy committee
think that interest rates should stay about where they are because inflation is
still low. But others felt that interest rates should be raised because delays
might lead to dangerously high inflation later.
Fed officials unanimously agreed to leave the interest rates unchanged.
Gold rose $3.20 to $1,282.90 an ounce. Silver climbed 23 cents, or 1.4
percent, to $16.94. Copper jumped 6 cents, or 2.4 percent, to $2.95 a pound.
In other energy trading, wholesale gasoline lost 2 cents to $1.56 a gallon.
Heating oil fell 3 cents to $1.57 a gallon. Natural gas shed 5 cents to $2.89
per 1,000 cubic feet.
France's CAC 40 rose 0.7 percent, and Germany's DAX and the FTSE i100 in
Britain rose by the same amount. Tokyo's Nikkei 225 retreated 0.1 percent while
the Hang Seng in Hong Kong rose 0.9 percent. The South Korean Kospi advanced