Stocks edge higher as retailers rally


Share
Posted Online: Jan. 15, 2013, 5:52 pm
Comment on this story | Print this story | Email this story
BC-US--Wall Street,3rd Ld-Writethru/804
Eds: Updates with close of trading. With AP Photos.

STEVE ROTHWELL,AP Business Writer


NEW YORK (AP) — Stocks edged higher on Wall Street after a rally in retail stocks offset concerns about flaring tensions in Washington over increasing the country's borrowing limit.

The Dow Jones industrial average ended the day up 27.57 points at 13,534.89. The Dow moved higher in the late afternoon after being down as much as 62 points in the early going.

The Standard and Poor's 500 rose 1.66 points to 1,472.34, a five-year high. The Nasdaq composite index, dragged down by a fall in Apple, fell 6.72 points to 3,110.78.

Retail stocks moved higher throughout the day, boosted by a report that showed retail sales increased in December, helping the major indexes reverse early losses.

Consumers bought more autos, furniture and clothing, despite worries about potential tax increases, the Commerce Department said Tuesday. Sales rose 0.5 percent in December from November, slightly better than November's 0.4 percent increase and the best showing since September.

J.C. Penney rose 62 cents, or 3.4 percent, to $18.71. Dollar General gained $1.62, or 3.8 percent, to $44.64. Ford advanced 31 cents, or 2.2 percent, to $14.30.

Treasury Secretary Timothy Geithner told congressional leaders in a letter late Monday that the U.S. government will reach its borrowing limit as soon as mid-February, earlier than expected. Federal Reserve Chairman Ben Bernanke also commented on the issue Monday, saying it was one of the "critical fiscal watersheds" for the government in coming weeks.

President Barack Obama has criticized congressional Republicans for linking talks over raising the debt ceiling to ongoing budget negotiations. Obama said the consequences of the U.S. government defaulting on its debt would be disastrous and shouldn't be used as a bargaining chip to extract concessions on spending cuts.

"We are very concerned how the market is going to respond to all the news events that will be coming out of Washington over the next few months," said Eric Wiegand, a senior portfolio manager at U.S. Bank Wealth Management. "It really comes down to the uncertainty and the risk of a further downgrade of our debt."

Markets were roiled in the summer of 2011 as lawmakers haggled over an increase to the debt limit. The dispute cost the U.S. its AAA ranking from the credit-rating firm Standard and Poor's.

The U.S. fiscal crisis is still the biggest single individual risk facing investors, with 37 percent of investors naming it as the biggest worry, according to a survey of fund managers published by Bank of America Merrill Lynch Tuesday. The European debt crisis was cited as the biggest concern by 23 percent of those polled and a "hard landing" for the Chinese economy was third on the list with 12 percent.

Apple fell $15.83, or 3.2 percent, to $485.92, closing below $500 for the first time in almost a year. Apple slumped 3.6 percent Monday on concern that demand for its iPhone 5 is slowing. Nomura analysts today lowered their target price for the stock to $530 from $660 and cut their estimates for iPhone sales this year.

Both the S&P 500 and the Dow are up on the year, having surged in the first week of January after lawmakers reached a last-minute budget deal to stop the economy going over the "cliff." The agreement prevented a series of tax increases and spending cuts that could have pushed the U.S. economy back into recession, according to economists.

Optimism about the outlook for global growth has also boosted stocks.

The S&P 500 is up 3.2 percent this year. The 30-member Dow is up 3.3 percent since the start of 2013.

The yield on the 10-year Treasury note, which moves inversely to its price, was little changed at 1.84 percent.

Among other stocks making big moves;

— Dell gained 88 cents, or 7.2 percent, to $13.17, rising for a second day on a report that the computer maker is in talks with private equity firms about a buyout.

— Facebook fell 85 cents, or 2.7 percent, to $30.10, paring its gains for the year to 13 percent, after the company unveiled a new feature Tuesday that lets users search their social connections for information about people, interests, photos and places.

— Lululemon Athletica, a maker of yoga apparel, dropped $2.83, or 3.9 percent, to $69.47 after its revenue forecast fell short of analysts' estimates.

— Given Imaging Ltd. fell $2.10, or 11.5 percent, to $16.10 after the medical equipment company said it was no longer considering a sale. Also one of its largest shareholders plans to sell its stake.

















 



Local events heading








  Today is Wednesday, April 23, the 113th day of 2014. There are 252 days left in the year.

1864 — 150 years ago: Some persons are negotiating for 80 feet of ground on Illinois Street with a view of erecting four stores thereon. It would serve a better purpose if the money was invested in neat tenement houses.
1889 — 125 years ago: The Central station, car house and stables of the Moline-Rock Island Horse Railway line of the Holmes syndicate, together with 15 cars and 42 head of horses, were destroyed by fire. The loss was at $15,000.
1914 — 100 years ago: Vera Cruz, Mexico, after a day and night of resistance to American forces, gradually ceased opposition. The American forces took complete control of the city.
1939 — 75 years ago: Dr. R. Bruce Collins was reelected for a second term as president of the Lower Rock Island County Tuberculosis Association.
1964 — 50 years ago: Work is scheduled to begin this summer on construction of a new men's residence complex and an addition to the dining facilities at Westerlin Hall at Augustana College.
1989 — 25 years ago: Special Olympics competitors were triple winners at Rock Island High School Saturday. The participants vanquished the rain that fell during the competition, and some won their events; but most important, they triumphed over their own disabilities.




(More History)