Energy, retail shares lead US stocks higher

GMT 22:52 2015 Wednesday ,04 November

Arab Today, arab today Energy, retail shares lead US stocks higher

The Dow Jones Industrial Average
New York - AFP

Wall Street stocks rose for the second straight session Tuesday, led by resurgent oil shares and retailers after a pair of US clothing chains raised their earnings forecasts.
Dow members ExxonMobil rose 1.8 percent and Chevron 3.4 percent, extending Monday's gains as investors continued to pile into the beaten-down sector.

Retail stocks jumped after Victoria's Secret parent company L Brands and teen retailer American Eagle Outfitters lifted their earnings forecasts, with the latter saying it was able to charge full prices and resort less frequently to promotions.

L Brands rose 3.0 percent, while American Eagle gained 7.9 percent. Among other retailers, Dow member Wal-Mart Stores added 0.9 percent, Target 1.3 percent and Best Buy 0.9 percent.

"Just about anything tied to the consumer is having an above-average day today," said Michael James, managing director of equity trading at Wedbush Securities.

The Dow Jones Industrial Average ended up 89.39 points (0.50 percent) at 17,918.15.

The broad-based S&P 500 rose 5.74 (0.27 percent) to 2,109.79, while the tech-rich Nasdaq Composite Index advanced 17.98 (0.39 percent) to 5,145.13.

Insurer American International Group (AIG) fell 4.4 percent as it rejected activist investor Carl Icahn's idea to split into three parts. AIG though reported a third-quarter loss of $231 million.

King Digital Entertainment, the creator of the "Candy Crush" game, jumped 14.9 percent on news it agreed to be acquired by Activision Blizzard for $5.9 billion. Activision fell 3.6 percent.

General Motors rose 0.6 percent and Ford gained 0.4 percent after both automakers reported their best US October sales in 11 years.

Car rental company Avis Budget plunged 11.4 percent as it projected full-year profit of $3.10-$3.25 per share, down from the August forecast for $3.15-$3.45. The company expects a negative hit from foreign exchange fluctuations of 20 cents per share.

Fitbit, maker of wireless fitness trackers, fell 8.6 percent despite projecting better-than-expected profits. Analysts pointed to concerns about high valuation and to a plan to sell some 24 million additional shares, including from a follow-on equity offering after the recent IPO.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.21 percent from 2.18 percent Monday, while the 30-year advanced to 3.00 percent from 2.95 percent. Bond prices and yields move inversely.

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