Retail Sales Bounce Bolsters Wall Street

Wall Street advanced on Tuesday as the prospect of additional stimulus and a record jump in retail sales suggested the US economy could bounce back sooner than expected, five months into its pandemic-inflicted recession.

All three major US stock indexes posted their third consecutive daily gains.

Data released by the Commerce Department showed retail sales jumped by a record 17.7 percent in May, blowing past the 8 percent increase analysts expected.

Investor risk appetite was given a further boost by the government's anticipated US$1 trillion dollar infrastructure package aimed at jump-starting the economy.

"The retail sales numbers is the story that's driving markets higher," said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina. "But the smell of stimulus in the air is adding to today's gains for sure."

Amid a resurgence of new Covid-19 cases in China and the United States, along with unabated progression of the pandemic in Latin America and elsewhere, a UK-led drug trial showed low doses of generic steroid drug dexamethasone reduced Covid-19 death rates among the most severe cases.

At the beginning of his two-day testimony before Congress, Federal Reserve Chairman Jerome Powell said: "Until the public is confident that the disease is contained, a full recovery is unlikely."

The Dow Jones Industrial Average rose 2.04 percent, to 26,290, the S&P 500 gained 1.90 percent, to 3,125 and the Nasdaq Composite added 1.75 percent, to 9,896.(Reuters)

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