U.S. stock futures advance as data show retail sales accelerate
U.S. stock futures advanced, indicating the Standard & Poor’s 500 Index will gain a fifth day, after retail sales rose by the most in five months and as investors awaited a Federal Reserve decision on interest rates.
Morgan Stanley and Citigroup Inc. added at least 1.9 percent to pace gains in financial shares. Anadarko Petroleum Corp. and Alcoa Inc. rose more than 0.8 percent as a gauge of commodities rose. Urban Outfitters Inc., the operator of its namesake, Anthropologie and Free People brands, lost 2.7 percent after reporting earnings that missed analysts’ estimates.
S&P 500 futures expiring in June increased 0.5 percent to 1,373.30 at 8:42 a.m. New York time. Dow Jones Industrial Average futures rose 59 points, or 0.5 percent, to 12,956.
“Demand for equities seems to be relatively robust,” Manoj Ladwa, a senior trader at ETX Capital in London, said in a Bloomberg Television interview. “As long as interest rates are where they are at the moment, and they stay where they are, then demand for equities is going to be there.”
Equity futures advanced after data showed retail sales rose 1.1 percent in February, matching the median forecast of 81 economists surveyed by Bloomberg News. Yet a pickup in payrolls accompanied by limited wage gains may not be enough to satisfy Fed officials, who today will probably reaffirm a commitment to keep interest rates low.
The S&P 500 has risen 9 percent this year through yesterday amid better-than-expected economic data and as companies beat analysts’ profit forecasts for a 12th straight quarter. Most U.S. stocks retreated yesterday, capping the thinnest trading day in 2012, as investors weighed whether a Chinese slowdown will lead to an easing of monetary policy.
Banks Rally
Banks rose today after the group slumped yesterday on concern about how banks will perform in Federal Reserve stress tests. Morgan Stanley added 2.3 percent to $18.61. Citigroup rose 1.9 percent to $34.95.
Energy and raw material shares rose as the S&P GSCI index of 24 commodities increased 0.4 percent. Anadarko Petroleum rallied 0.8 percent to $85.46. Alcoa increased 1 percent to $9.97.
Urban Outfitters lost 2.7 percent to $28.70. Net income in the three months ended Jan. 31 fell 48 percent to $39.3 million, or 27 cents a share, from $75.2 million, or 45 cents a share, a year earlier. The average estimate of 33 analysts surveyed by Bloomberg was 29 cents.
A bad year for American equity trading is getting worse. Shares changing hands on all U.S. exchanges fell 16 percent to 5.23 billion yesterday from March 9, while S&P 500 composite volume slipped 17 percent to 2.17 billion shares, data compiled by Bloomberg show.
Lowest in 2012
Those are the lowest daily levels of 2012 and the smallest totals excluding holiday weeks since Bloomberg began tracking the data in 2008.
A rally that has restored more than $3.2 trillion into U.S. equities has failed to lure investors following one of the most volatile years on record. While the S&P 500 has had its best annual start since 1998, individuals are shunning equities after they were burned in 2011 by Europe’s debt crisis, said Mark Turner, head of U.S. sales trading at Instinet Inc. in New York.
“I don’t think investors are completely convinced,” Turner said in a telephone interview. Volume “was extremely light volume because it was quiet in Europe over the weekend and there was no major headlines coming out of Europe,” he said. “Money has been shifting to bonds out of equities for some time now. There’s a host of different reasons. Take your pick.”
Nasdaq composite trading volume slipped 15 percent to 1.34 billion shares, the lowest excluding holidays since Aug. 27, 2007, when it was 1.34 billion shares, data compiled by Bloomberg show. Volume of shares for securities traded on the New York Stock Exchange declined 10 percent to about 644 million shares, the lowest since Feb. 24, Bloomberg data show.