U.S. markets turn higher after data offset losses abroad
U.S. stocks rose moderately by Thursday early afternoon as better than expected U.S. economic data, including retail sales and jobless claims, worked to counter sharp losses in Japan and a cut in the World Bank's global economic growth outlook.
As of just before noon ET, the Dow was up 57 points to 15,052, the Nasdaq rose 13 points to 3,413 and the S&P 500 added 6 points to 1,619.
Earlier in the day, global markets felt a sharp sting as investors become increasingly fearful of the inevitable pulling back from monetary stimulus, with the Bank of Japan earlier this week holding steady on its monetary policies, and no indication that the Fed would not soon begin tapering its monthly bond purchases.
The Nikkei Stock Average plunged 6.4% today, pushing the index into bear market territory, while European markets finished mixed after the U.S. data.
Investor sentiment was also impacted as the World Bank cut its global economic growth forecast to 2.2% for this year, down from the initial 2.4% projection in January.
In the U.S., the Labor Department reported this morning that jobless claims for the week that ended June 8 fell to 334,000 from 346,000 in the prior week. Economists expected jobless claims to rise to 350,000.
Retail sales also jumped 0.6% in May, beating the 0.5% rise expected. This is up from a 0.1% increase in April.
Meanwhile, mport prices fell 0.6% in May, compared to a 0.7% fall in April. Economists were expecting import prices to remain steady.
And finally, the Commerce Department said business inventories rose 0.3% in April, in line with expectations of economists polled by MarketWatch.
On Wednesday, the Dow finished down for the third day in a row, losing 126.79 points to finish at 14,995.23, below the 15,000 mark, after starting the day 119 points higher. Volatility has characterized U.S. markets of late, as uncertainty about the Fed's QE program rattles investors.
In corporate news, Gannett (NYSE:GCI) has agreed to acquire Belo Corp (NYSE:BLC) for $2.2 billion, including debt. Under the terms of the deal, Gannett will pay $13.75 a share in cash, or around $1.5 billion, in addition to assuming $715 million in existing debt. Shares of Belo surged 27%, while Gannett shares soared 26%.
Elsewhere, Safeway (NYSE:SWY) shares rose almost 9% after the company said it agreed to sell its Canadian business to Canadian grocery store operator Empire Co for C$5.8 billion in cash. Safeway will use the proceeds of the deal, expected to close in the fourth quarter, to pay down debt and buy back stock.
In materials shares, DuPont Co. (NYSE:DD), the largest U.S. chemical company by market value, slid 1% as it lowered its first-half earnings forecast after cool, wet weather in North America and Europe affected revenue and costs at its agriculture and nutrition and health units
In other stocks, PVH Corp (NYSE:PVH) gained almost 10% after reporting better-than-expected adjusted earnings for the first quarter. The New York-based company earned $1.91 per share, excluding certain items, beating estimates of $1.35. It also adjusted its current quarter forecast to $1.35 per share, in line with Wall Street estimates.
Gold futures tumbled $15 to $1,377 an ounce Thursday, while crude for July delivery picked up four cents to $95.91 barrel after the U.S. economic data.
European markets finished mixed as of the most recent closing prices. The CAC 40 gained 0.19% and the FTSE 100 rose 0.08%. The DAX lost 0.59%.