(eToro Blog) The United States reported that retail sales grew 0.1% in December, much below market expectations. Sales grew to $400.6 billion. On a yearly basis sales grew 6.5% from December 2010. Holiday retail sales grew 4.1% from 2010 levels. Analysts and economists were expecting a growth of 0.4% in December after a 0.4% growth in November.
Markets were disappointed as unofficial estimates suggested that holiday sales broke record levels. Economists are still holding out hope that the government report was not able to capture all the data and it will be revised higher in the coming months. The report showed that electronic store sales dropped 3.9%. Online retailers posted a drop of 0.4% in sales. General merchandise stores reported a decline of 0.8% in sales. Clothing stores posted increase of 0.7% in sales.
Initial jobless claims, a benchmark of the labor market, climbed 24,000 to 399,000 in the week that ended January 7th. This was a disappointment for the U.S. economy as analysts were counting on the continued drop in initial jobless claims to pull the U.S. firmly out of the recession. There are some seasonal quirks that need to be considered before losing faith in the U.S. labor market. Retailers, mail delivery companies and manufacturers let go off people between Christmas and New Year’s as part of their business practice. Those workers can file for unemployment claims.
Wall Street was little unchanged as markets remained unsure of future direction. With disappointing U.S. economic data and the BOE and ECB keeping rates on hold, markets remained cautious. The Dow is down 0.05%, the Nasdaq is up 0.28% and the S&P 500 is up 0.04%.
Traders on OpenBook are primarily long on the Dow (DJ30) with average limits at 12,520 and stops at 12,300.
Copyright 2012 eToro Blog
