Nov 17, 2009
Wall Street renewed its 2009 high on Monday due to better-than-expected retail sales and higher commodity prices resulting from a weaker dollar.
The U.S. Commerce Department reported on Monday that retail sales rose 1.4 percent in October as demand for autos climbed, much higher than the 0.8-percent prediction by economists and the 2.3-percent decline in September. The reading eased concern that households will curtail spending after government incentives ended.
However, excluding autos, sales rose 0.2 percent, weaker than the 0.4-percent increase economists had expected, while wholesale inventories fell for a 13th consecutive month in September.
Federal Reserve Chairman Ben Bernanke anticipated on Monday that the U.S. economy will continue its recovery next year, but warned about more challenges ahead.
He also reaffirmed the Fed would keep low interest rates for an extended period.
"The Federal Open Market Committee continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period," said the Fed chairman at the New York Economic Club.
On corporate news, home improvement retailer Lowe's Cos. reported its third-quarter profit fell 30 percent. But the company said some of the hardest hit home markets are stabilizing.
The U.S. dollar fell against a basket of currencies on Monday, helping extend gains in commodities. Crude prices surged more than3 percent while gold futures set a new record high.
The Dow Jones rose 136.49, or 1.33 percent, to 10,406.96. The Standard &Poor's 500 index climbed 15.82, or 1.45 percent, to 1,109.30 and the Nasdaq increased 29.97, or 1.38 percent, to 2,197.85.