Stocks continue to trade in mixed fashion as the Dow rose while the S&P 500 fell. Trading volume increased as the Dow closed at 17,251 up 22. The recent diverse movements of the Dow, NASDAQ and S&P may indicate that value stocks are gaining favor over growth stocks.
Retail sales in February dipped 0.1% which was in line with expectations. Retail sales for January were also revised lower from a 0.2% gain to a 0.4% decline. The drop was attributed mostly to declining auto sales. Signs of retail strength were seen in the building material and garden supply stores. Food service and restaurants also saw a 1% gain in February. The retail report prompted Barclays Bank to lower its 2016 US GDP growth forecast from 2.4% to 1.9%. Morgan Stanley also lowered its US GDP forecast to 1.7% from 1.9% citing pressure from a slowdown in emerging markets and a tepid European economy.
The manufacturing sector got a boost from the New York Federal Reserve’s Empire State manufacturing index which rose to its first positive reading since last July. New orders and shipments rose and employment was steady.
WTI crude oil fell 2% to $36.43 a barrel as worries about stockpiles and rising production from Iran persist. Gold fell $11.50 an ounce to $1,233. What was interesting about today’s drop in gold was that shares of gold mining companies all were higher. Gold bugs are citing increased buying of gold by banks and individuals as a hedge against negative interest rates.