Closing Bell: Markets Recover for Small Gains After Fed Official Affirms Stimulus

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Dennis Lockhart president Federal Reserve Bank atlanta economy stocks investing
Scott Eells/Bloomberg via Getty ImagesDennis Lockhart, president of the Federal Reserve Bank of Atlanta.
U.S. stocks erased earlier losses to end marginally higher Tuesday after a top Fed official said the economic picture is too mixed for the U.S. central bank to detail its exit strategy from massive stimulus.

The Dow Jones industrial average (^DJI) rose 31 points (0.2 percent) to 15,451, the Standard & Poor's 500 index (^GPSC) climbed 4 points (0.3 percent) to 1,694 and the Nasdaq composite index (^IXIC) gained 14 points (0.4 percent) to close at 3,684.

Atlanta Fed President Dennis Lockhart said recent data don't present a clear picture of the economy, but at the same time, he didn't rule out some decrease next month in the $85 billion monthly pace of bond buys currently underway.

In other economic news, the Commerce Department reported that U.S. retail sales rose in July, pointing to an acceleration in consumer spending that could signal more robust growth through the rest of the year. Retail sales rose 0.2 percent in July. Stripping out the volatile categories of cars, gasoline and building materials, the sales numbers showed an ever better gain -- 0.5 percent, the largest in seven months.


Other data released Tuesday showed that small businesses were more optimistic in July, although companies rebuilt inventories in June at an unexpectedly weaker pace.

Shares of J.C. Penney (JCP) fell almost 4 percent to $12.68 after the company announced Bill Ackman had quit the company's board of directors, as part of a deal to resolve an unusually public battle between the activist investor and the struggling department store operator.

The Justice Department filed a lawsuit in federal court in Washington to block the merger of US Airways and American Airlines, saying the combination would cause "substantial harm" to consumers by leading to higher fares and fees. The airlines said the government's conclusions were wrong, and they vowed to use "all legal options" to fight back.

US Airways (LCC) stock fell 13.2 percent to $16.34. Other airlines lost ground, too. Delta Air Lines (DAL) dropped 7 percent to $19.55, while United Continental Holdings (UAL) dropped 7.4 percent to $30.74.

More Stocks in the News:
  • Shares of Jos. A. Bank Clothiers (JOSB) jumped more than 12 percent to $45.35 after BeaconLight Capital said the men's clothing chain's stock is undervalued and publicly urged for changes at the company.
  • Yum Brands (YUM), which owns the Taco Bell, Pizza Hut and KFC fast-food chains surrendered 2 percent to $72.95, after reporting sales in China fell 13 percent in July.
  • Eli Lilly & Co. (LLY) rose 2.6 percent to $54.94 after the company said its potential lung cancer treatment necitumumab had met a key research goal by helping to increase survival time for patients in a late-stage study.
  • PulteGroup (PHM) fell 2.3 percent, to $15.37, leading a broad decline in homebuilder stocks.
What to Watch Wednesday:
  • The Labor Department releases its Producer Price Index for July at 8:30 a.m. Eastern time.
  • The Energy Information Administration releases its weekly report on petroleum stockpiles.
These major companies are scheduled to release quarterly corporate earnings statements.
  • Cisco Systems (CSCO)
  • Deere & Co. (DE)
  • Macy's (M)
  • NetApp (NTAP)
  • Towers Watson (TW)



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michael_vici

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August 13 2013 at 11:25 PM Report abuse rate up rate down Reply
betty_brock

Good night, Evan. Hope someone else comes along for you to banter with.

August 13 2013 at 9:20 PM Report abuse -1 rate up rate down Reply
betty_brock

Is your real name Anthony Weiner, Evan?

August 13 2013 at 9:16 PM Report abuse -1 rate up rate down Reply
betty_brock

I wonder what liberals like Evan and myself will do when we run out of other people's money.

August 13 2013 at 9:02 PM Report abuse rate up rate down Reply
betty_brock

Liberals have a hard time understanding basic economics.

August 13 2013 at 8:32 PM Report abuse rate up rate down Reply
tomjohnkraus

No question previous stimulus had a positive effect. Unfortunately, that is only half the equation. If we ever pay for the handouts, we can then assess the benefits versus the cost. My prediction is we will never pay for it.

August 13 2013 at 6:59 PM Report abuse +1 rate up rate down Reply
betty_brock

The more money the FED prints, the less what you have is worth.

August 13 2013 at 6:03 PM Report abuse +2 rate up rate down Reply
betty_brock

massive stimulus = bad news for taxpayers

August 13 2013 at 6:02 PM Report abuse rate up rate down Reply
Big John

Oh Boy! More free money for big banks and Wall Street. Hire more people? What for? Oh, you retired folks, to bad.

August 13 2013 at 5:20 PM Report abuse -1 rate up rate down Reply
1 reply to Big John's comment
Hello Bob

It is all good for me, it must be your problem.

August 13 2013 at 5:23 PM Report abuse -1 rate up rate down Reply
1 reply to Hello Bob's comment
betty_brock

It is all bad for taxpayers. Are you on welfare?

August 13 2013 at 6:01 PM Report abuse -2 rate up rate down
Freedom Chyld

Stop the help, let the markets crazh and let it all fail and fall down... then and only then can America rebuild from the ground up... and hopefully do a better job than we did last time America crashed.

August 13 2013 at 4:37 PM Report abuse rate up rate down Reply