The major stocks were rebounding Thursday amid optimistic consumer spending and labor market reports. As of 12 p.m.:
|DIJA: +0.40% to 15055.17||S&P 500: +0.47% to 1620.05||NASDAQ: +0.44% to 3415.32|
|Gold: -0.5% to 75.01||Oil: +0.09% to 22.29||U.S. 10-Year: -2.11% to 21.83|
Here are three stories helping drive the markets Thursday afternoon:
1. Don’t Worry Economy, U.S. Consumers Are Still Spending: Slight improvements in the labor market and lower borrowing costs are encouraging consumers to spend, evidenced by a higher-than-expected increase in retail sales last month. The United States Commerce Department announced that consumer spending — which accounts for about 70 percent of economic activity in the U.S. — pushed retail sales up 0.6 percent in May. This figure was the strongest performance recorded in three months and followed a 0.1 percent increase in April. Given that retail sales have been weak recently, economists had expected just a 0.5 percent increase.
While the gain was largely powered by consumers’ car purchases, as spending at dealerships rose 1.9 percent, even stripping out car sales left retail sales up 0.3 percent… (Read more.)
2. Do Top U.S. Executives Believe a ‘Recovery’ Is Taking Place? There is no doubt that the U.S. economy is still struggling to make a convincing recovery from the credit meltdown. Asset prices have been pushed higher by the Federal Reserve, and the labor market is failing to keep pace with population growth. However, the latest report on sentiment from chief executive officers predicts a slight improvement for certain areas of the economy over the next six months.
The Business Roundtable, which is an association of chief executive officers of leading U.S. companies, recently published its second-quarter CEO Economic Outlook Survey… (Read more.)
3. After Last Week’s Spikes, Jobless Claims Steadily March Downward: Following last week’s Employment Situation Report, the labor market was given another sign that job gains will continue; the United States Department of Labor said that the number of Americans applying for initial unemployment benefits dropped 12,000 to a seasonally adjusted 334,000 in the week ending June 8.
As applications for unemployment benefits act as a proxy for layoffs, this drop shows that employers are refraining from firing workers even as economic growth appears to be cooling this quarter. Fewer layoffs indicate that companies have pared their workforces about as much as possible, which puts employers in position to boost payrolls should business improve in the second half of the year. So far in 2013, new applications have decreased by 6.5 percent… (Read more.)
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