US Stock Market Overview – Stock Close Mixed Despite Robust Retail Sales Report

Consumer sentiment rises more than expected
David Becker

US stocks were mixed on Friday, as stronger than expected retail sales buoyed some sectors, but higher interest rates weighed on growth shares. US Retail Sales came in stronger than expected while consumer confidence surged. Import prices remain subdued which was in line with other inflation indices released earlier in the week. Technology shares are facing headwinds as congress subpoenas their records.

US Retail Sales Rise More than Expected

The Commerce Department reported on Friday that US retail sales rose moderately in August, driven higher by a jump in auto buying and healthy online sales. The Commerce Department says retail sales increased 0.4% last month, down from 0.8% in July. Excluding autos, sales were unchanged for the first time since February. Online sales continued to soar, rising 1.6%, roughly the same amount as in July, when Amazon held its Prime Day.

Consumer Confidence Surges

US Sentiment more than expected this month as consumers felt more confident about current and future economic conditions, according to a preliminary release from the University of Michigan. The September report on consumer sentiment rose to 92 from 89.8 in August. Expectations had been for sentiment to rise to 91.  The current economic conditions index also rose to 106.9 from 105.3.

US Import Prices Declined in August

US import prices fell in August amid declines in the cost of petroleum products and food, suggesting imported inflation could remain subdued for a while. The Labor Department reported on Friday import prices dropped 0.5% last month. Data for July was revised lower to show import prices gaining 0.1% instead of rising 0.2% as previously reported. Expectations had had forecast import prices would decline 0.4% in August. In the 12 months through August, import prices decreased 2.0% after dropping 1.9% in July.

Import prices exclude tariffs. In August, prices for imported fuels and lubricants dropped 4.3% after rebounding 0.7% in July. Petroleum prices declined 4.8% after increasing 0.9% in the prior month. Imported food prices fell 0.3%, the fourth straight monthly decline. Excluding fuels and food, import prices were unchanged last month after edging up 0.1% in July. The core import prices decreased 1.1% in the 12 months through August.

Technology Firms Face Headwinds

Large tech firms continue to face headwinds as they are in Congresses crosshairs. The house opened a new front in the government’s antitrust probe of giant technology firms, with House lawmakers on Friday demanding emails and other records from some of the industry’s top chief executives as they look for evidence of anticompetitive behavior. The requests from House Judiciary Committee leaders from both parties to Inc., Facebook Inc., Apple Inc. and Alphabet Inc., owner of Google, sets up potential conflicts between tech leaders.

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