Stocks ended the trading week on a mixed note with the NASDAQ up while old man Dow fell 22 points to 20,896 on light trading volume. IBD still has markets in rally mode. For the week the Dow fell about 120 points or 0.6%.
JC Penny’s and Nordstrom’s both reported earnings yesterday. JC Penny beat on earnings but missed revenue estimates by posting a 4% sales drop. Shares plunged to an all-time low. Nordstrom’s did better with a 3% revenue rise and a slight increase in the bottom line but the results failed to inspire and shares tumbled about 10%.
Despite the negative earnings news by department stores, the US consumer is doing fine as retail sales in April rose 0.4%. These figures show that the consumer is spending money but doing it more via the internet instead of brick and mortar. Non-store or internet retailers now make up 10.8% of retail sales and, while this is the highest level ever, is growing at a rapid pace.
The US and China have revealed a new trade deal that opens Chinese markets to more US companies and agencies. Commerce Sec. Wilbur Ross said that beef, poultry, Nat gas, agriculture, financial services and biotech were included in the import/export deal which should serve to reduce the trade deficit with Beijing. Industry groups cheered the news and Ross said this sets the stage for more deals in the future and signals that US China relations are improving. He said something about China which I found interesting. He said China is a “relationship” country meaning that relationships are more important that contracts written on paper.