Wall Street opened higher for the second straight day after data showed that retail sales rose in May, the latest sign that a recovery in the U.S. economy was finally gathering steam.
U.S. retail sales increased 1.2 percent in May, topping the 1.1 percent growth expected by economists, as households boosted purchases of automobiles and a range of other goods even as they paid a bit more for gasoline.
Other data showed that U.S. import prices rose in May after 10 months of declines, while weekly jobless claims rose slightly more than expected but remained in territory consistent with a strengthening labor market.
“The retail sales (data) is just another piece of the economic puzzle and one that investors have been waiting for,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.
“The Fed will definitely get one rate hike under its belt this year, and another one next year.”
The market is bound to be volatile when the hike is eventually announced as a third of the market participants have never seen a rate increase, Hogan said.
At 9:34 a.m. ET the Dow Jones industrial average .DJI was up 61.36 points, or 0.34 percent, at 18,061.76, the S&P 500 .SPX was up 6.72 points, or 0.32 percent, at 2,111.92 and the Nasdaq Composite .IXIC was up 16.83 points, or 0.33 percent, at 5,093.52.
All 10 major S&P 500 sectors were higher, with the utilities index’s .SPLRCU 0.65 percent rise leading the gains. Duke Energy (DUK.N) and Amren Corp (AEE.N) were up more than 1 percent.
Investors have been perusing economic data closely for clues on the timing of a rate hike by the U.S. Federal Reserve.
The Fed has said it will raise rates only when it sees a rebound in the economy after growth came to a standstill in the first quarter.
Economists and top Wall Street banks expect the Fed to raise rates in September, which would be the central bank’s first hike in almost a decade and finally mark a turn in the direction of the flow of easy money that has driven world stocks and bond prices to record highs in recent years.
The World Bank on Wednesday joined the International Monetary Fund in urging the U.S. Federal Reserve to hold off on a rate hike until next year to avoid worsening exchange rate volatility and crimping global growth.
Box (BOX.N) shares jumped 14.2 percent to $20.37 after the cloud storage provider raised its full-year forecast.
Citrix Systems (CTXS.O) rose 5.9 percent to $69.83 after shareholder Elliott Management said the software maker should sell some units, cut costs and buy back shares.
Krispy Kreme (KKD.N) rose 9 percent to $19 after the doughnut chain raised the bottom end of its 2016 profit forecast.
Advancing issues outnumbered decliners on the NYSE by 1,880 to 767. On the Nasdaq, 222 issues rose and 859 fell.
Seventeen stocks on the S&P 500 index hit a 52-week high and two a 52-week low. The Nasdaq recorded 35 highs and five lows.
Source: Reuters
