Saturday, 10 November 2012

Wall Street up on strong consumer confidence

REUTERS

NEW YORK

STOCKS bounced higher on Friday as buyers stepped in following two days of steep losses after data showed confidence among consumers and wholesale business inventories were stronger than expected.

Consumer sentiment rose to its highest level in more than five years in November, according to the Thomson Reuters/University of Michigan preliminary index of sentiment, indicating Americans felt more optimistic about employment prospects and the outlook for the overall economy.

Still, markets remained concern about the widening eurozone crisis and the looming ‘fiscal cliff.’ President Barack Obama, re-elected three days ago, is expected to make a statement in the White House about the looming tax increases and government spending cuts.

The so-called fiscal cliff would begin early next year and unless Congress acts to change the law before then, experts warn the economy could tip into recession.

Obama’s statement is scheduled for 1:05 pm (1805 GMT).

“The bounce-back in stocks is a little bit of a realization the selloff is overdone, but it doesn’t mean it won’t continue,” said John Manley, chief equity strategist for Wells Fargo Advantage Funds in New York.

The Dow Jones industrial average rose 22.28 points, or 0.17 percent, to 12,833.60. The S&P 500 gained 6.52 points, or 0.47 percent, to 1,384.03. The Nasdaq Composite added 18.65 points, or 0.64 percent, to 2,914.24.

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