NEW YORK: U.S. stocks recorded the biggest gain in more than a month as expectations for a rate hike were pushed back following disappointing data on retail sales.
Monthly sales at U.S. retailers fell for the third consecutive month in February, sparking concerns about consumers’ ability to keep the economic engine going.
The gains propelled the S&P 500 and Dow industrials back into positive territory for the year.
The S&P 500 SPX, +1.26% closed 25.71 points, or 1.3%, higher at 2,065.95, with nine of its 10 main sectors finishing with gains. Financials led the way, with the sector gaining 2.2%. The Dow Jones Industrial Average DJIA, +1.47% jumped 259.83 points, or 1.5%, to 17,895.22, with 26 of its 30 members ending in positive territory. It was the strongest daily rise for both the S&P and the Dow since Feb. 3.
The Nasdaq Composite COMP, +0.89% ended the day up 43.35 points, or 0.9%, at 4,893.29.
Ahead of the opening bell, investors digested mixed economic data. Disappointing monthly retail sales gave investors hope that the Fed will stay accommodative for longer, pushing expectations for the rate hike further in the year, according to analysts.
“Today’s bounce is indicative of a shift in expectations, namely that the Fed will delay rate hikes, given poor retails sales figures,” said Dan Greenhaus, chief global strategist at BTIG LLC.
“Over the past several sessions markets traded poorly as investors came to grips with the idea that the Fed will begin the tightening sooner rather than later. That is the reason the dollar has been strengthening,” Greenhaus said.
