US stocks lose steam

Written By Unknown on Senin, 15 Oktober 2012 | 22.33

US stocks lost momentum after opening gains on Monday as investors digested upbeat retail sales data and a weak manufacturing report.

After 45 minutes of trade (1415 GMT), the Dow Jones Industrial Average was up 10.06 points, or 0.08 per cent, at 13,338.91.

The broad-based S&P 500 slipped 0.11 point (0.01 per cent) to 1,428.48, while the tech-rich Nasdaq fell 2.55 points (0.08 per cent) to 3,041.56.

"Stocks gained after a report showed retail sales unexpectedly rose 1.1 per cent in September," Wells Fargo Advisers said.

The Commerce Department report also revised higher the retail sales increases for July and August, offering a stronger picture of the sector that is a major part of consumer spending, the main driver of the US economy.

"The best story is that even excluding both auto and gas (petrol), sales were still up 0.9 per cent in September, with a 0.2 per cent revision in August, partly thanks to the release of iPhone 5," said Mei Li at FTN Financial.

Other economic numbers disappointed. The Federal Reserve's Empire State manufacturing index for New York state showed activity continued to contract for a third straight month.

On the earnings front, Citigroup reported an 88 per cent drop in third quarter profit to $468 million Citi shares surged 3.5 per cent, with Charles Schwab & Co. analysts explaining that the fall was not as bad as expected.

Debt-laden Sprint Nextel rose 0.7 per cent after Japan's Softbank announced it would pay $20 billion to acquire 70 per cent of the third-biggest US mobile firm, behind AT&T and Verizon Wireless.

Both AT&T and Verizon dropped 0.9 per cent.

Microsoft gained 0.7 per cent after unveiling Xbox Music, which offers free music streaming for computers and tablets with the new Windows operating system to be launched this month.

On Friday the major indices finished broadly lower amid concerns about the new earnings season. The S&P 500 fell 0.3 per cent.

US bond prices dropped. The 10-year Treasury yield rose to 1.67 per cent from 1.66 per cent Friday, while the 30-year yield increased to 2.84 per cent from 2.83 per cent.

Bond prices move inversely to yields.


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