Stocks hit another new high on retail forecast
NEW YORK -- Macy's gave the stock market some early holiday cheer.
Stock indexes climbed back into record territory Wednesday after the department store chain gave an optimistic forecast for holiday sales. Macy's surged 9 percent, leading strong gains among retailers including J.C. Penney, Nordstrom and Target.
The forecast from Macy's shows that the U.S. may be heading into the holidays with a surprising retail wind at its back. And it's the latest news that suggests the economy, while far from robust, is showing stronger-than-expected strength to close out the year. That could continue pushing up a stock market that is already soaring without the benefit of a booming economy.
"When the consumer starts spending, it's pretty much a rising tide," said Ron Florance, deputy chief investment officer for Wells Fargo Private Bank. "That gives a big lift across the board."
The Standard & Poor's 500 index rose 14.31 points, or 0.8 percent, to 1,782, its 34th record close this year. The index is up 25 percent this year. If it ends 2013 with that gain, it would be the best performance in a decade.
The Dow Jones industrial average gained 70.96 points, or 0.5 percent, to 15,821.63, also a record. The Nasdaq composite rose 45.66 points, or 1.2 percent, to 3,965.58, well below its record close of 5,048.52 reached in March 2000.
Macy's jumped $4.35 to $50.68. Its earnings climbed 22 percent for the quarter ended. Nov. 2. The department store chain, which rose the most in the S&P 500 index, was the first major retailer to report earnings for the quarter.
The shopping season is a critical time for retailers because it can account for much of their yearly revenue.
The season also indicates where consumer spending, a key driver of the economy, is headed.
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