NEW YORK, May 26 — US stocks got off to another solid start today, extending the gains made in the prior session amid a flurry of positive earnings news from major retailers.
While government data showed the US economic downturn in the first quarter was slightly worse than originally reported, with GDP contracting 1.5 per cent, consumer spending was revised higher.
The 3.1 per cent increase “exceeded the consumer spending growth in the third and fourth quarters, demonstrating that the US consumer was still acting as a key growth engine in the first quarter despite rising interest rates and higher costs for most goods and services, namely food and energy,” Briefing.com analyst Patrick J O’Hare said in an analysis.
Stocks have been battered in recent weeks, declining steadily amid concerns about the economic outlook due to rising interest rates to tame surging inflation, as well as the impact of the Russian war in Ukraine on prices and of China’s Covid-19 lockdowns on global supply chain.
Disappointing earnings by major retailers such as Target also hit investor sentiment, but the latest reports show chains like Macy’s, Dollar Tree and Dollar General delivering better-than-expected results and upbeat forecasts.
About 30 minutes into the trading session, the Dow Jones Industrial Average climbed 1.2 per cent to 32,519.46.
The broad-based S&P 500 advanced 1.3 per cent to 4,031.05, while the tech-rich Nasdaq Composite Index jumped 1.4 per cent to 11,597.22.
Chipmaker Broadcom jumped 2.2 per cent after announcing a US$61-billion (RM268-billion) deal to purchase cloud computing firm VMware, which rose one per cent.
Macy’s shares surged 11.3 per cent, while discount chain Dollar Tree jumped more than 17 per cent and Dollar General gained 13 per cent. — AFP
