By Dow Jones Business News,
August 13, 2014, 08:45:00 AM EDT
U.S. Stocks End Higher
U.S. stocks ended higher Wednesday, with the Dow re-entering positive territory for the year, as investors looked
beyond a weaker-than-expected report on retail sales.
The Dow Jones Industrial Average gained 91.26 points, or 0.55%, to 16651.80. The S&P 500 climbed 12.97 points, or
0.67%, to 1946.72, and the Nasdaq Composite Index added 44.87 points, or 1.02%, to 4434.13.
The Dow is up 0.45% so far this year, having closed 2013 at 16576.66. The S&P 500 is up 5.32% since the start of the
Wednesday's gains come as the stock market has been stuck in a seesaw mode in recent sessions. An escalation of
geopolitical risks in mid-July collided with concerns about the end of the Federal Reserve's loose monetary policy,
sending broad market benchmarks down from record high levels. However, improving economic data and upbeat corporate
earnings have kept underlying sentiment generally positive.
Stocks are likely to grind higher amid low interest rates and a strengthening recovery, said Jim Dunigan, chief
investment officer at PNC Wealth Management. The Fed isn't likely to raise rates sooner than expected, he added.
"The Fed would want to be fairly confident that the economic momentum is in place and strong enough that when it
begins to raise rates, the economy can continue to sustain itself," said Mr. Dunigan.
Stocks gained Wednesday even as data showed retail sales were flat in July, falling short of expectations for a 0.2%
While the retails-sales data disappointed, it isn't enough to change the broad picture of an economy posting moderate
growth, said Peter Kenny, chief market strategist at Clearpool Group. "It was more a confirmation of an otherwise
expanding economy than a deviation," Mr. Kenny said.
Some investors acted to "take advantage of the selloff that occurred at the end of July," said Keith Bliss, senior
vice president at brokerage Cuttone & Co. "None of the fundamental aspects have been damaged and the market is set up to
continue moving higher," he said.
News flow out of the Middle East and Russia has been relatively light this week, keeping the market calm, said Reed
Choate, a portfolio manager at Neville, Rodie & Shaw. Also, many market participants go on vacation in August.
"It's another slow day," Mr. Choate said. "Volume is low and there's less business getting done."
The Bovespa, an index tracking Brazilian stocks, fell following reports that a Brazilian presidential candidate was
killed in a plane crash.
European stocks rose, with the Stoxx Europe 600 index up 0.4%. The British pound fell against the U.S. dollar
Wednesday, hit by disappointing labor figures and a dovish inflation report from the Bank of England.
The Bank of England cut its forecasts for wage growth to 1.25% from 2.5% for this year and suggested that weak wage
growth could push back the timing of the U.K.'s first rate increase from historic lows. Governor Mark Carney said that
normal rates are likely to be "lower than those of yesteryear."
The yield on the 10-year Treasury note fell to 2.413%, according to FactSet. Treasury yields move inversely with
In corporate news, Macy's Inc. shares dropped 5.5% after the company reported second-quarter earnings and revenue that
fell short of expectations. It also reduced its sales outlook for the year.
Deere & Co. said it expects its equipment sales to fall 6% in the fiscal year, a bigger decline than it previously
forecast. The company said its full-year earnings are likely to be lower than in 2013. Shares fell 2.3%.
Shares of King Digital Entertainment PLC tumbled 23% after the company posted second-quarter revenue that fell short
of expectations and reported weakness in its main "Candy Crush Saga" videogame.
In commodity markets, crude-oil futures rose 0.1% at $97.42 a barrel. Gold futures rose 0.1% to $1,312.5 an ounce.
Saumya Vaishampayan contributed to this article.
Write to Daniel Huang at firstname.lastname@example.org
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