While you were sleeping Shares of Macy's jump

Thursday 14th November 2013

Shares of Macy's soared, last up 9.5 percent, after the department store chain reported third-quarter profit that exceeded expectations and expressed confidence about the outlook.

"Our business improved during the quarter, with particular strength in October, so we are entering the fourth quarter with confidence," Terry Lundgren, chairman, president and chief executive officer of Macy's, said in a statement.

The fourth quarter includes the all-important holiday season.

"They're in good shape," Edward Jones analyst Brian Yarbrough told Reuters. "Unless something changes abruptly in consumer sentiment, they should have a great holiday season."

Investors are eyeing Federal Reserve Chairman Ben Bernanke who is scheduled to speak tonight at a town hall meeting in Washington for any clues on the central bank's plans to taper, or change, its monetary stimulus package following better-than-expected jobs and GDP data.

Tomorrow his nominated successor, Vice Chairman Janet Yellen, will testify to the Senate Banking Committee.

In afternoon trading in New York, the Standard & Poor's 500 Index gained 0.17 percent, while the Nasdaq Composite Index rose 0.46 percent.

The Dow Jones Industrial Average edged 0.1 percent lower. Gains in shares of Home Depot, last up 1.6 percent, and UnitedHealth Group, last up 1.3 percent, offset declines in El du Pont de Nemours, last down 2.3 percent, and Verizon Communications, last 0.9 percent weaker.

"We are bouncing back and forth here because the market is divided on higher rates and the benefits of a strong economy. Investors have not made up their mind on which is more of a driving force for the market," Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey, told Reuters.

Meanwhile, a Treasury auction of 10-year bonds drew solid demand, highlighting concern about an equity market that is close to record highs. The notes were auctioned at a yield of 2.75 percent, compared with 2.657 percent at the previous sale on Oct. 9.

"A lot of people in the market are concerned about the vulnerability of the equity markets," Ian Lyngen, a government-bond strategist at CRT Capital Group in Stamford, Connecticut, told Bloomberg.

In Europe, the Stoxx 600 Index retreated 0.6 percent, as did France's CAC 40. Germany's DAX fell 0.2 percent.

The euro-zone's economic recovery remains fragile. Industrial production in the region fell a larger-than-expected 0.5 percent in September, following a 1 percent gain in August, according to data released by the European Union's statistics office.

Meanwhile, the UK's FTSE 100 Index slumped 1.4 percent as better-than-expected jobs data prompted the Bank of England to predict its target unemployment rate might be reached sooner than originally estimated. That means it might lift its benchmark interest rate sooner, too.

"Investors had a myopic focus on the Bank of England's unemployment projection; they feared it would be brought forward and it was," Guy Foster, the London-based head of portfolio strategy at Brewin Dolphin, told Bloomberg. "The Bank of England expects the unemployment threshold to be passed in 2015. Traders think the risk of interest rates rising has increased."

BusinessDesk.co.nz

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