It has been a roller-coaster day for US equities, with blue-chips reversing earlier losses to notch up modest gains.
The S&P 500 index was up three points at the start of the afternoon session at 2,089, while the Dow Jones industrial average was boasting a 30 point gain at 17,435.
The Nasdaq Composite was 16 points to the good at 5,035.
Expectations of a firm start had been quelled by better than expected retail sales for July raised the prospect of an early interest rate rise.
Jobless figures also suggested the US economy is fit enough to withstand an end to the Fed’s rock-bottom interest rates policy; first time claims rose by 5,000 to a seasonally adjusted 274,000 for the week to 8 August, which means claims have stayed resolutely below the 300,000 level for the 23rd week in succession.
Meanwhile, China’s central bank decided to lower its currency again for the third day in succession, but also dismissed as nonsense talk that it will be happy to see the yuan decline by 10%.
“The PBoC [People’s Bank of China] briefing came in as a rare defense conference after intervening few days ago, leading to a total weight on global equities,” noted Abu Dhabi-based financial services firm ADS Securities.
“Moreover, the bank thinks that the market will stabilize and the yuan would eventually resume its climb. Finally, the bank noted that it is ready to step in when needed, most probably by slashing the reserve requirement ratio,” ADS added.
While retail sales were recovering, department store Kohl’s (NYSE:KSS) was, ironically, one of the biggest blue-chip fallers, shedding around 10%.
In the quarter ended 1 August, Kohl’s reported a profit of US$130mln, worth 66 cents a share, down from US$232mln (US$1.13) a year earlier.
Chief executive Kevin Mansell attributed an underwhelming sales performance to the shift in sales in tax-free states from July into August.
The market liked the update from network equipment maker Cisco (NASDAQ:CSCO), released after the bell yesterday, and pushed the shares up 4% in the morning session.
Net income rose to US$2.3 billion, or US$0.45 per diluted share, in the three months ended July 25, from US$2.2 billion, or US$0.43 per diluted share, a year earlier.
Adjusted earnings were US$0.59 per share, surpassing the US$0.56 average estimate of 34 analysts surveyed by Capital IQ.
Fourth-quarter revenue increased 4% to US$12.8 billion year-over-year. That result exceeded the Wall Street consensus of US$12.7 billion.
Better news from the retail sector came from Dillard’s (NYSE:DDS), which climbed 2.9%.
The fashion apparel retailer reported profit declined in its most recent quarter, weakened by declining margins, but still bested analysts’ expectations.
Shares of Tesla Motors (NASDAQ:TSLA) shrugged off news that the electric car specialist would be turning to the market to finance its rapid pace development.
The California based company said it would sell US$500 million new common shares; nevertheless, the shares rose 2.1%.
Tesla’s chief executive officer (CEO), Elon Musk, himself said he intends to buy US$20 million of the new shares issued in connection with this offer. In detail, 2.1 million shares will be issued at the previous day’s closing price of US$238.17.