Market report

Retailer rally edges stocks higher

Trader Michael Capolino works on the floor of the New York Stock Exchange, Wednesday, Aug. 16, 2017. Stocks are opening higher on Wall Street following some encouraging results from retailers.
Trader Michael Capolino works on the floor of the New York Stock Exchange, Wednesday, Aug. 16, 2017. Stocks are opening higher on Wall Street following some encouraging results from retailers.

NEW YORK -- U.S. stocks rose slightly Wednesday as Urban Outfitters and Target helped retailers rally. That was enough to cancel out more losses for energy companies.

The Standard & Poor's 500 index rose 3.50 points, or 0.1 percent, to 2,468.11. The Dow Jones industrial average rose 25.88 points, or 0.1 percent, to 22,024.87. The Nasdaq composite gained 12.10 points, or 0.2 percent, to 6,345.11. The Russell 2000 index of smaller companies inched up 0.30 points to 1,383.53.

Urban Outfitters and Target did better in the second quarter than analysts expected, and Target raised its forecasts for the year. That helped companies that sell clothing and other retailers. Technology companies and firms that make and sell household goods also traded higher.

A wide variety of retailers saw their shares sink Tuesday based on weak earnings reports. With Wal-Mart and Ross Stores in line to report their own results today, investors could change their minds again.

"This sector is not for the faint of heart," said JJ Kinahan, chief strategist for TD Ameritrade. "The market is trying to figure out who the winners and losers are going to be."

He said turbulence for retailers will be a constant as online competition keeps growing and customers want more features such as same-day delivery.

Clothing and accessories retailer Urban Outfitters had a better second quarter than Wall Street expected, and analysts said there are some signs the company's business is recovering after years of struggles. The stock rose $2.94, or 17.5 percent, to $19.76. Even with those gains, it's down 31 percent this year and recently traded at eight-year lows, far below its price of $45 a share in early 2015.

Target gained $1.96, or 3.6 percent, to $56.31. The company raised its annual estimates after it did better than analysts expected in the second quarter.

Gap climbed 50 cents, or 2.3 percent, to $22.57. Express shares rose 27 cents, or 4.8 percent, to $5.84. Retailers had struggled a day earlier after poor results and lower forecasts from Dick's Sporting Goods and Advance Auto Parts. The S&P 500 index of retailers climbed 1.7 percent Wednesday after a 2.3 percent plunge the day before.

Benchmark U.S. crude fell 77 cents, or 1.6 percent, to $46.78 a barrel in New York. Brent crude, used to price international oils, dipped 53 cents, or 1 percent, to $50.27 a barrel in London. That pulled energy companies down further. EOG Resources fell $2.04, or 2.3 percent, to $84.98 and Marathon Oil fell 34 cents, or 2.9 percent, to $11.19.

Bond prices turned higher. The yield on the 10-year Treasury note fell to 2.23 percent from 2.27 percent.

With bond yields falling, banks and financial companies turned lower as well. Lower bond yields mean lower interest rates on loans and fewer profits for banks.

Lincoln National fell $1.03, or 1.4 percent, to $71.14 and Bank of America gave up 28 cents, or 1.1 percent, to $24.19. Regions Financial sank 14 cents, or 1 percent, to $14.34.

The minutes from the Federal Reserve's meeting last month were released Wednesday. They did not include many details about the central bank's plans for letting its balance sheet shrink.

Business on 08/17/2017

Upcoming Events