Investors on Wednesday put aside angst associated with Eurozone debt and the Gulf of Mexico oil spill, at least for the day, as retail shares shot up 1.5 percent and the Dow Jones Industrial Average settled comfortably above 10,000 with a 2.3 percent advance.
This story first appeared in the June 3, 2010 issue of WWD. Subscribe Today.
The S&P Retail Index rose 6.65 points to 443.93 Wednesday, making up ground lost the day before. Fashion gainers included Limited Brands Inc., up 3.5 percent to $25.95; Coach Inc., 3.3 percent to $41.60; Nordstrom Inc., 2.6 percent to $40.25, and Macy’s Inc., 2.4 percent to $22.40.
The Dow added 225.52 points to end the day at 10,249.54. It spent the entire day in positive territory after two consecutive days of declines, one to end last week and one to begin this one.
Investors received a hint of better times ahead from the forward-looking Pending Home Sales Index, which is based on contracts signed in April and compiled by the National Association of Retailers. The index rose 6 percent from March to 110.9. Pending home sales are at their highest level since October, when buyers rushed to qualify for a tax credit that was later extended.
“The tax stimulus, combined with improved consumer confidence and low mortgage interest rates, are contributing to surging sales,” said Lawrence Yun, the trade group’s chief economist. “The housing market has to get back on its own feet and now appears to be in a good position to return to sustainable levels even without government stimulus, provided the economy continues to add jobs.”
European markets were relatively tranquil with the FTSE 100 down 0.2 percent to 5,151.32 in London, the CAC 40 off 0.1 percent to 3,501.50 in Paris and the DAX essentially holding steady at 5,981.20 in Frankfurt.
The Nikkei 225 fell 1.1 percent to 9,603.24 in Tokyo and the Hang Seng Index dipped 0.1 percent to 19,471.80 in Hong Kong.