US open: Stocks open higher as traders digest retail sales data

dl wall street st new york city nyc nyse stock exchange ny dow jones nasdaq sp finance us usa united states of america — Wall StreetSharecast photo / Josh White

Wall Street stocks were in the green early on Tuesday as market participants digested last month's all-important retail sales report.

As of 1515 GMT, the Dow Jones Industrial Average was up 0.44% at 36,244.83, while the S&P 500 was 0.31% firmer at 4,697.41 and the Nasdaq Composite came out the gate 0.21% stronger at 15,887.25.

The Dow opened 157.38 points higher on Tuesday, easily reversing modest losses recorded in the previous session.

Tuesday's primary focus was October retail sales data, which revealed US retail sales grew at a quicker than expected pace last month, driven by an early start to holiday shopping.

The value of overall retail purchases increased 1.7% month-on-month to $638.2bn in October, following an upwardly revised 0.8% increase in September for the sharpest increase seen in seven months, according to the Commerce Department. Excluding gas and motor vehicles, sales jumped 1.4% in October. Economists were expecting sales to have jumped by 1.5% last month.

In the corporate space, Home Depot posted third-quarter earnings that came in ahead of estimates on the Street, driven by a 9.8% quarterly sales increase, while Walmart also topped estimates after winning back grocery shoppers amid heightened inflation.

Also in focus, US president Joe Biden and Chinese leader Xi Jinping wrapped up their meeting on a much more positive note than originally expected, with it now appearing that there is a willingness on both sides to mend a relationship damaged during the previous White House administration.

Elsewhere on the macro front, industrial production rebounded in October, up 1.6% month-on-month following a 1.3% drop in September, according to the Federal Reserve, with automakers, previously impacted by supply chain problems, saw a strong increase and headwinds stemming from Hurricane Ida faded. In the major industry groups, manufacturing activity rose 1.2%, while mining surged 4.1% and output at the nation's utilities was up 1.2%.

Still on data, business inventories increased 0.7% month-on-month to $2.10trn in September, according to the Census Bureau, down just a touch from August's revised print of 0.8%, while the combined value of distributive trade sales and manufacturers' shipments for September was estimated at $1.66trn, up 0.9%. The total business inventories/sales ratio based on seasonally adjusted data at the end of September was 1.26.

Lastly, the National Association of Housebuilders' housing market index came in at 83 in November, ahead of both consensus estimates and last month's print of 80, with a solid market for home building continuing in November despite ongoing supply-side challenges as a lack of resale inventory combined with strong consumer demand to boost single-family homebuilding.

After closing at 1.584% on Monday, the yield on the benchmark 10-year Treasury note ticked up to 1.615% at the open on Tuesday.

Dow Jones - Risers

Home Depot Inc. (HD) $385.36 3.85%
Nike Inc. (NKE) $172.04 1.89%
Unitedhealth Group Inc. (UNH) $457.18 1.42%
Intel Corp. (INTC) $50.99 1.32%
Walt Disney Co. (DIS) $160.13 1.07%
Travelers Company Inc. (TRV) $159.74 1.06%
Chevron Corp. (CVX) $117.62 0.68%
Cisco Systems Inc. (CSCO) $57.65 0.65%
International Business Machines Corporation (CDI) (IBM) $119.57 0.59%
Visa Inc. (V) $213.55 0.59%