Stocks advance as retailers climb amid Black Friday sales

NEW YORK – U.S. stocks rose, sending the Standard & Poor’s 500 Index toward its eighth straight weekly advance, as retailers including Gap Inc. and Best Buy Co. gained amid Black Friday sales events.

Gap and Best Buy advanced at least 0.8 percent as retailers opened their doors to holiday shoppers. Apple Inc. climbed 0.7 percent after a report showed the company sold three of every four smartphones in Japan last month. Archer-Daniels-Midland Co. fell 2 percent after Australia blocked a A$2.2 billion ($2 billion) takeover of GrainCorp Ltd.

The S&P 500 rose 0.3 percent to 1,812.45 at 10:16 a.m. in New York. The gauge is up 0.4 percent for the week, poised for a monthly gain of 3.2 percent. The Dow Jones Industrial Average added 63.58 points, or 0.4 percent, to 16,160.91 today. Trading in S&P 500 stocks was 39 percent below the 30-day average at this time of the day. U.S. markets were closed yesterday for the Thanksgiving holiday and trading will end at 1 p.m. today.

“The general mood is that we’re going to have growth this year in terms of holiday season shopping, though probably less than before the crisis,” Aaron Izenstark, co-founder and chief investment officer of Iron Financial LLC’s Iron Strategic Income Fund in Northbrook, Ill., said by phone. “There is an expectation in the market that it has started out on a positive note, so I do think that is definitely driving thoughts today in the marketplace.”

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The S&P 500 and the Dow finished at records on Nov. 27, as jobless claims unexpectedly declined and a measure of consumer confidence beat estimates. The S&P 500 has climbed 27 percent this year, poised for its best year since 1997, and the Dow has gained 23 percent after the Federal Reserve refrained from tapering its third round of economic stimulus.

Fed minutes

Minutes of the last Fed meeting released on Nov. 20 showed that officials are considering scaling back their $85 billion in monthly bond purchases “in coming months” if the economy improves as anticipated.

Investors will await reports on manufacturing and home sales next week, and the November release of non-farm payrolls on Dec. 6. Janet Yellen, who will replace Ben S. Bernanke as chairman of the Fed, has said she will ensure monetary stimulus isn’t removed too soon to support economic recovery in the U.S.

“Investors are waiting for indications on when tapering may come,” said Ioan Smith, strategist at KCG Europe Ltd. “The minutes revealed a wide-ranging discussion of various policy scenarios and contingencies. It is still the case that there’s not enough sustained evidence to meet the taper criteria as soon as next month.”

Economic data today showed euro-area unemployment unexpectedly declined in October, the latest indication that the bloc’s recovery is gaining traction. A separate report yesterday showed economic confidence in the euro region improved more than economists forecast to a 27-month high in November.

Black Friday

All 10 main industry groups in the S&P 500 advanced, with consumer discretionary stocks climbing 0.4 percent. Gap jumped 1.1 percent to $41.21 and Best Buy rose 0.8 percent to $39.93 to pace advances among retailers. Macy’s Inc., L Brands Inc. and J.C. Penney all increased.

Millions of Americans will hit the malls today for Black Friday. The cost of hedging against losses in U.S. retailers has slipped to the lowest level in more than three years as investors speculate that an improving labor market and falling gas prices will stimulate holiday sales.

U.S. retail sales climbed at a faster-than-expected pace in October, a measure of consumer sentiment beat estimates this month and jobless claims fell to their lowest since September last week, signaling a strengthening U.S. economy. Gasoline prices are near their lowest since February 2011, while house prices are climbing at the fastest rate since 2006.

Early opening

Sales are projected to advance 2.4 percent this holiday, the smallest increase since 2009, the year the recession ended, according to researcher ShopperTrak. Faced with six fewer days between Thanksgiving and Christmas than last year, retailers are pouring on the discounts to lure customers. Many chains opened earlier than ever this year to win market share.

“There’s a chance the holiday season will be quite good,” Pierre Mouton, who helps oversee $6 billion as a portfolio manager at Notz, Stucki & Cie. in Geneva, said in a message on Nov. 27. “The simple effect of less unemployment, an improving real estate market and lower gasoline prices should help.”

Technology companies gained 0.4 percent as a group. EBay Inc. rose 2.3 percent to $50.44 and Amazon.com Inc. jumped 1 percent to $390.51. Online sales are projected to climb as much as 15 percent to $82 billion during the holidays, according to the National Retail Federation.

Apple gains

Apple rose 0.7 percent to $549.99. The company accounted for 76 percent of smartphone sales in Japan last month after the country’s largest carrier, NTT Docomo Inc., began offering the iPhone, market researcher Kantar Worldpanel ComTech said yesterday.

ADM dropped 2 percent to $40.66. Australia’s rejection of the agricultural commodities producer’s takeover prompted a record 22 percent drop in GrainCorp, the biggest crop handler on Australia’s east coast, and a slide in the local currency.

“This proposal has attracted a high level of concern from stakeholders and the broader community,” Treasurer Joe Hockey said today, ruling U.S.-based ADM’s bid of A$12.20 a share isn’t in the national interest. “Now is not the right time for a 100 percent foreign acquisition of this key Australian business.”

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