Dow Jones lifted by retail sales


Dow Jones lifted by retail sales
The main share index in the United States climbed to another record high yesterday after news of strong retail sales reassured investors.

On Wall Street the Dow Jones industrial average closed up more than two per cent, with the stock market also cheered by developments in the mining sector.

After jumping 283.86 points the index finished on a record 13,861.73 points – its strongest daily gain since October 2002.

Standard & Poor's 500 Index also climbed 28.94 points, or 1.91 per cent, to close at a record 1,547.70, while the Nasdaq experienced its highest rise in over six years after climbing 49.94 points, or 1.88 per cent.

The markets were buoyed by the impact of the takeover announcement made by Anglo-Australian mining group Rio Tinto, which has agreed to buy Canadian aluminium maker Alcan in a $38.1 billion (£18.7 billion) deal.

Shares in US mining group Alcoa subsequently rose 6.2 per cent amid speculation that the company could itself become a takeover target after its own bid for Alcan appeared to have been trumped by the agreement.

Upbeat sales figures from retailers including grocer Wal-Mart also boosted the markets following recent concerns about the impact that rising consumer debt and troubles in the sub-prime mortgage market could have on the US economy.

"With weakness in the housing market...the biggest concern was that we were going to see bad numbers from the retailers, but we're seeing the opposite," said Eric Kuby, chief investment officer at North Star Investment Management.

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