A lower U.S. unemployment rate helped stabilize equity markets Friday, pushing retail stocks up 0.2 percent for the day after a tough week stoked by government debt concerns in Europe.
The S&P Retail Index advanced 0.65 points to 392.84 Friday, making the decline for last week 1.2 percent. The Dow Jones Industrial Average increased 0.1 percent, or 10.05 points, to 10,012.23, a 0.5 percent drop for the week.
AnnTaylor Stores Corp. turned in the week’s best performance with a 16.6 percent jump to $14.65 after the retailer said better sales would help it top fourth-quarter profit projections.
Investors spent most of the week worrying over the creditworthiness of Greece, Portugal and Spain. Last week, the CAC 40 fell 4.7 percent to 3,563.76 in Paris and the FTSE 100 retreated 2.5 percent to 5,060.92 in London.
Debt watchdog Standard & Poor’s said the economic downturn was testing the credit quality of Europe’s local and regional government.
“The impact has been significant, with negative rating actions largely exceeding positive ones in 2009,” S&P said. “Yet, the effect of the crisis has differed by region or country, in our view. Spanish [local and regional governments] are those more severely hit and where we still expect to see negative rating actions across the board in 2010.”
S&P said the 142 local governments it rates in 22 European countries were generally healthy from a credit perspective and the regions with speculative-grade ratings were in Central and Eastern Europe, primarily Russia, Ukraine and Bulgaria.
Markets finally found their footing Friday when the U.S. reported its unemployment rate dropped to 9.7 percent from 10 percent instead of advancing to the expected 10.1 percent.
“The radical shift to risk aversion in the past several weeks…pushed down commodity prices and benchmark bond yields to levels that have not been seen in months, while the U.S. dollar was sent soaring,” IHS Global Insight U.S. economists Brian Bethune and Nigel Gault said in an analysis. “The silver lining to this latest convulsion in the financial markets is that any residual risks of inflation in the U.S. have been fully annihilated for the near future.”
The economists said interest rates would remain at “exceptionally low levels for some time.”
This week, investors will get fresh readings on the U.S. trade balance Wednesday, retail sales Thursday and consumer confidence Friday.
In honor of Rihanna’s 30th birthday, we took a look back at an interview with the Barbados-native when she was just 18 years old. Here, she talked about her second album, “A Girl Like Me” in 2006. “I want to be me. I want people to fall in love with who Rihanna is, and that’s why I want the album to be about me so people can really find out who this girl Rihanna is, because they only know the ‘Pon de Replay’ girl.” Fast forward 12 years, and she’s released six more albums and has become a powerhouse in both the fashion and music industries. Happy birthday, @badgalriri 🎈(📷: Pavel Antonov) #wwdarchive
For @simonerocha_‘s fall show, hairstylist @jamespecis created a look inspired by the painter John Constable. Models’ hair was pulled back, tied into knots and topped off with a bow. (📷: @kukukuba) #wwdbeauty #lfw
Queen Elizabeth made a surprise appearance at @richardquinn1's London Fashion Week show to present the designer with the inaugural Queen Elizabeth II Award for British Design. The new award will be handed out annually to an emerging British fashion designer who shows exceptional talent, while demonstrating value to the community and sustainable policies. #wwdfashion #lfw (📷: @giovanni_giannoni_photo)