Better Results From Retailers Help Send Stock Market Higher

Asian shares gained Friday as investors cheered great earnings from retailers. It also sent the US shares higher. Benchmarks rose in early training across Asian markets like China, Japan, and even in Australia and South Africa.

Yeap Jun Rong, market strategist at IG in Singapore, stated, “Improved risk sentiments in Wall Street, along with earnings outperformance from Alibaba and Baidu, may aid to fuel some upside for the Asia region into today’s session.”

Shares of Baidu and Alibaba also soared as they reported better than expected results and eased concerns regarding the negative impact of restrictions to curb COVID-19 infections. Wall Street ended broadly higher. It was a relief as it had seen seven straight weeks of declines. It was the longest such stretch since the year 2001.

Bond yields also increased. The yield on the 10-year Treasury reached 2.75% from 2.74% late Wednesday. About 90% of the stocks in the S&P 500 increased. In addition to retail, banking and technology companies drove the rally.

Liz Young, head of the investment strategy at SoFi, stated, “It’s nice to see a couple days in the green, and this might actually end up being the first week when we don’t have a humongous down day. But I wouldn’t declare premature victory and assume we’re in the clear.”

The S&P 500 increased 79.11 points, or 2%, to reach 4,057.84, and the Dow added 516.91 points, or 1.6%, to reach 32,637.19. Even the Nasdaq rose 305.91 points, or 2.7%, to reach 11,740.65. The Russell 2000 index of smaller companies also increased 39.07 points, or 2.2%, to reach the level of 1,838.24.

Macy’s also rose 19.3% after it raised its profit forecast for the year following a strong first-quarter financial report. Dollar General rose 13.7%, and Dollar Tree jumped 21.9% after the discount retailers reported solid earnings and provided investors with encouraging forecasts.

The Worries Remain

Despite the good performance, worries still remain. Inflation is at a four-decade high. Businesses have been increasing prices on everything from food to clothing to offset the higher costs. The inflation pressures are worsened due to the Russia-Ukraine war, leading to higher energy and key food commodity costs. Supply chain issues are again cropping up as China has imposed strict lockdowns to control the spread of COVID-19. Even the consumers are resilient about spending, and they prefer to not spend on expensive things but on necessities.

Other Performers

Technology stocks performed quite well. TurboTax maker Intuit rose 4.6%. Airline stocks also increased thanks to encouraging summer travel forecasts. Southwest Airlines increased 6%, and JetBlue soared 3.4%.

Energy and Currency Trading

US benchmark crude added 36 cents to $114.45 a barrel in energy trading. US crude oil prices also increased by 3.4% Thursday, and Brent crude, the international standard, also soared 45 cents to $117.85 a barrel.

In currency trading, the US dollar lowered to 126.79 Japanese yen. It had reached 127.10 yen. The euro cost $1.0763. It is up from $1.0733.

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