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Stocks pushed higher as positive retail sales surprised investors.
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The data signals continued consumer strength, easing fears of a recession.
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All eyes are on the Federal Reserve’s likely interest rate cut on Wednesday.
Stocks moved higher after stronger-than-expected US retail sales boosted confidence in consumer health, as the Federal Reserve’s two-day policy meeting is set to kick off.
Retail sales increased 0.1% last month, compared to consensus estimates of a 0.2% decline. That’s welcomed news for investors, who are bracing for what is likely to be the Fed’s first interest rate cut at the conclusion of its meeting at 2 p.m. on Wednesday.
Although 67% of the market expects a more aggressive 50 basis point cut, according to the CME FedWatch Tool, Wall Street continues to be at odds on how deep the easing should be.
Strong retail sales suggest that the Fed does not necessarily have to hurry with larger cuts, as the consumer economy appears intact for now.
“Retail sales growth has been a little below the long-term average in recent months, but continues to grow at a modest rate,” said Scott Helfstein, Head of Investment Strategy at Global X.
“That should translate to modest consumption improvement and help drive reasonable GDP growth this quarter. This is one more sign that the economy remains in a mid-cycle expansion rather than contraction.”
Here’s where US indexes stood at the 9:30 a.m. opening bell on Tuesday:
Here’s what else is going on:
In commodities, bonds, and crypto:
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WTI crude increased 0.20% to $70.22 a barrel. Brent crude, the international benchmark, fell 0.07% to $72.65 a barrel.
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Gold slid 0.16% to $2,604.8 an ounce.
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The 10-year Treasury yield stayed essentially flat at 3.627%.
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Bitcoin climbed 2.36% to $59,239.
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