US Stock Market Overview – Stocks Surge to Record Highs

US stocks moved higher on Thursday driven by robust liquidity and stronger than expected retail sales. All sectors in the S&P 500 index were higher on Thursday driven by sharp gains in technology, energy shares were the worst performing sector. A stronger than expected core retail sales number in conjunction with declining initial jobless claims helped buoy riskier assets. The US senate passed the USMCA trade deal a day after the US and China agreed to their phase one trade deal.

US Retail Sales Rise Led by Core

The Commerce Department said on Thursday retail sales increased 0.3% last month. Data for November was revised up to show retail sales gaining 0.3% instead of rising 0.2% as previously reported. Expectations were for retail sales to gain 0.3% in December. Compared to December last year, retail sales accelerated 5.8%. Excluding automobiles, gasoline, building materials and food services, retail sales jumped 0.5% last month after falling by a downwardly revised 0.1% in November.Online and mail-order retail sales rose 0.2% after being unchanged in November.

Jobless Claims Drop

The jobs market continues to outperform and claims for unemployment continued to point to additional jobs coming online. Initial claims dropped 10,000 to 204,000 for the week ended January 11, according to the Labor Department. Expectations had been for claims to rise slightly to 216,000 in the latest week from the unrevised 214,000 reported for the previous week.

USMCA Passes Senate

The Senate approximate the United States-Mexico-Canada Agreement in an overwhelming 89-10 vote. After Trump signs the bill into law it needs only Canada’s approval to take effect. The Senate rushed to pass the agreement before the expected start of the president’s impeachment trial next week. USMCA will head to the president more than 14 months after the North American nations agreed to the deal. The Senate’s passage of USMCA came a day after Trump signed a partial trade deal with China.