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Dow Jones Hits Record High on Retail Sales
MoneyNews
Thursday, July 12, 2007
NEW YORK -- Stocks surged Thursday, carrying the DowJones industrials into
record territory as investors gleaned positive consumer spending trends from
retailers' June sales reports.
A new bid for aluminum maker Alcan Inc. added to the upbeat mood on Wall
Street, which drove the Dow up more than 100 points to a new intraday high.
Though retail sales on the whole appeared to be crimped last month by higher
gasoline prices and a tepid housing market, a few reports beat Street
expectations - notably that of Wal-Mart Stores Inc., the world's largest
retailer, which posted a better-than-expected 2.4 percent jump in sales at
stores open at least a year.
Wal-Mart, one of the 30 companies that make up the DowJones industrial
average, helped ease some investors' worries about the health of the
consumer ahead of the Commerce Department's Friday report on U.S. retail
sales.
Meanwhile, the stock market got an additional boost after mining company Rio
Tinto offered to buy Canadian aluminum company Alcan for $38.1 billion. The
offer topped a bid from Alcoa Inc. that Alcan's board rejected in May, and
Alcoa is considering whether to make another bid.
In mid-morning trading, the DowJones industrial average rose 116.81, or 0.86
percent, to 13,694.68, after climbing to 13,697.77, an intraday record. The
Dow's record close is 13,676.32, set June 4.
Broader stock indicators also surged higher.
The Standard & Poor's 500 index rose 11.00, or 0.72 percent, to 1,529.76,
nearing its record close of 1,539.18 reached June 4.
The Nasdaq composite index rose 16.22, or 0.61 percent, to 2,668.01.
The 10-year Treasury note's yield fell to 5.08 percent, down from 5.09
percent late Wednesday, adding to stock investors' glee. The dollar was
generally lower against other major currencies, dropping to a fresh record
low versus the euro and a new 26-year low against the British pound. Gold
prices rose.
Light, sweet crude rose 90 cents to $73.46 per barrel on the New York
Mercantile Exchange.
Alcan and Alcoa shares jumped Thursday after miner Rio Tinto countered
Alcoa's hostile bid for Alcan with a higher offer.
Alcan rose $8.39, or 9.4 percent, to $97.99, after hitting a 52-week high of
$98.21. Alcoa shares rose $2.52 or 5.9 percent, to $45.95, after hitting a
year-high of $46.15, possibly signaling investors' relief that an
Alcoa-Alcan combination would not go through.
Among the retailers surprising Wall Street, J.C. Penney Co. posted a
narrower-than-expected decline in its June same-store sales and reiterated
its second-quarter profit forecast to match analyst expectations. Penney
rose $2.77, or 3.9 percent, to $73.93.
American Eagle, a mall-based youth clothing retailer, saw its June
same-store sales jump 8 percent, nearly double the increase the Street
expected. American Eagle rose $1.56, or 6 percent, to $27.59.
Not all retailers had good news to report. Macy's, for one, fell $1.40, or
3.4 percent, to $39.01 after releasing same-store sales that were well below
forecasts and slashing its second-quarter guidance.
But overall, sales were better than investors had been bracing for. Analysts
have been keeping their expectations for second-quarter earnings low -
especially after profit warnings this week from cell phone maker Motorola
Inc., and retailers Home Depot Inc. and Sears Holdings Corp.
In economic data, the Commerce Department reported Thursday that the
international trade balance widened to $60.04 billion in May, as expected,
from $58.5 billion in April.
Advancing issues outnumbered decliners by more than 3 to 1 on the New York
Stock Exchange, where volume came to 269.6 million shares.
The Russell 2000 index of smaller companies rose 8.01, or 0.95 percent, to
847.98.
Overseas, Japan's Nikkei stock average fell 0.36 percent. In afternoon
trading, Britain's FTSE 100 rose 0.82 percent, Germany's DAX index advanced
0.91 percent, and France's CAC-40 rose 1.20 percent.
Dow Jones Hits Record High on Retail Sales
MoneyNews
Thursday, July 12, 2007
NEW YORK -- Stocks surged Thursday, carrying the DowJones industrials into
record territory as investors gleaned positive consumer spending trends from
retailers' June sales reports.
A new bid for aluminum maker Alcan Inc. added to the upbeat mood on Wall
Street, which drove the Dow up more than 100 points to a new intraday high.
Though retail sales on the whole appeared to be crimped last month by higher
gasoline prices and a tepid housing market, a few reports beat Street
expectations - notably that of Wal-Mart Stores Inc., the world's largest
retailer, which posted a better-than-expected 2.4 percent jump in sales at
stores open at least a year.
Wal-Mart, one of the 30 companies that make up the DowJones industrial
average, helped ease some investors' worries about the health of the
consumer ahead of the Commerce Department's Friday report on U.S. retail
sales.
Meanwhile, the stock market got an additional boost after mining company Rio
Tinto offered to buy Canadian aluminum company Alcan for $38.1 billion. The
offer topped a bid from Alcoa Inc. that Alcan's board rejected in May, and
Alcoa is considering whether to make another bid.
In mid-morning trading, the DowJones industrial average rose 116.81, or 0.86
percent, to 13,694.68, after climbing to 13,697.77, an intraday record. The
Dow's record close is 13,676.32, set June 4.
Broader stock indicators also surged higher.
The Standard & Poor's 500 index rose 11.00, or 0.72 percent, to 1,529.76,
nearing its record close of 1,539.18 reached June 4.
The Nasdaq composite index rose 16.22, or 0.61 percent, to 2,668.01.
The 10-year Treasury note's yield fell to 5.08 percent, down from 5.09
percent late Wednesday, adding to stock investors' glee. The dollar was
generally lower against other major currencies, dropping to a fresh record
low versus the euro and a new 26-year low against the British pound. Gold
prices rose.
Light, sweet crude rose 90 cents to $73.46 per barrel on the New York
Mercantile Exchange.
Alcan and Alcoa shares jumped Thursday after miner Rio Tinto countered
Alcoa's hostile bid for Alcan with a higher offer.
Alcan rose $8.39, or 9.4 percent, to $97.99, after hitting a 52-week high of
$98.21. Alcoa shares rose $2.52 or 5.9 percent, to $45.95, after hitting a
year-high of $46.15, possibly signaling investors' relief that an
Alcoa-Alcan combination would not go through.
Among the retailers surprising Wall Street, J.C. Penney Co. posted a
narrower-than-expected decline in its June same-store sales and reiterated
its second-quarter profit forecast to match analyst expectations. Penney
rose $2.77, or 3.9 percent, to $73.93.
American Eagle, a mall-based youth clothing retailer, saw its June
same-store sales jump 8 percent, nearly double the increase the Street
expected. American Eagle rose $1.56, or 6 percent, to $27.59.
Not all retailers had good news to report. Macy's, for one, fell $1.40, or
3.4 percent, to $39.01 after releasing same-store sales that were well below
forecasts and slashing its second-quarter guidance.
But overall, sales were better than investors had been bracing for. Analysts
have been keeping their expectations for second-quarter earnings low -
especially after profit warnings this week from cell phone maker Motorola
Inc., and retailers Home Depot Inc. and Sears Holdings Corp.
In economic data, the Commerce Department reported Thursday that the
international trade balance widened to $60.04 billion in May, as expected,
from $58.5 billion in April.
Advancing issues outnumbered decliners by more than 3 to 1 on the New York
Stock Exchange, where volume came to 269.6 million shares.
The Russell 2000 index of smaller companies rose 8.01, or 0.95 percent, to
847.98.
Overseas, Japan's Nikkei stock average fell 0.36 percent. In afternoon
trading, Britain's FTSE 100 rose 0.82 percent, Germany's DAX index advanced
0.91 percent, and France's CAC-40 rose 1.20 percent.
