American shoppers spent more freely than forecast in October 2004, the Commerce Department reported, with retail sales rising 0.2 percent from September on a seasonally adjusted basis. A 2.2 percent drop in car and parts sales weighed on the total. Set that category aside, and sales climbed 0.9 percent.
The result caught Wall Street off guard, since analysts had penciled in a gain of just 0.1 percent overall. Investors welcomed the news, sending the Standard and Poor's 500 index up 0.91 percent to 1,184.17, its strongest close since before the September 2001 attacks.
The spending came alongside a firmer labor market. Employers added 337,000 jobs during the month, a seven-month high, and the University of Michigan's consumer sentiment gauge rose to 95.5 in early November from 91.7 in October. Household spending accounts for roughly two-thirds of US economic activity, so those signals carried weight.
Gasoline stations led the gains, up 4.3 percent as pump prices topped 2.00 dollars a gallon, followed by clothing stores at 3.0 percent. Building material and garden retailers slipped 1.1 percent. "Consumers are spending money, there is little doubt about that," said economist Joel Naroff, though some analysts noted the figures looked softer once fuel costs were stripped out.
TurkishPress summary of a November 2004 wire report.