Sales of the Home Depot, Inc. (NYSE:HD) recently made a comeback, enabling the company to earn profits much higher than those expected by analysts for the second quarter of the fiscal year. The US stocks have hit new records contrary to the speculations of experts. Inflation pressures remained limited and the housing sector witnessed a significant improvement. It is reported that the S&P 500 is at its all-time highest at the moment.
Since the company earned higher than expectations of analysts, it has raised its forecast for the rest of the year. Similarly, the TJX Companies, Inc. (NYSE:TJX) and Dicks Sporting Goods Inc (NYSE:DKS) rose more than 3.3 percent. Aeropostale Inc (NYSE:ARO), on the other hand, jumped 23 percent.
At 11:54 a.m. Yesterday in New York, the S&P 500 jumped by 0.4 percent to 1,978.73 which is within 0.5 percent of a record. Moreover, the The Dow Jones Industrial Average reached 16,902.27, showing an increase of 0.4 percent. According to analysts, the drop in mortgage rates is benefiting the housing market significantly, which in turn has proved to be quite beneficial for US stocks.
On the 18th of August, S&P 500 jumped by 0.9 percent due to a slight ease in concern over the Ukraine crisis. Earlier, global conflicts of Ukraine, Gaza and Iraq cause the gauge to fall by 3.9 percent. Moreover, the benchmark index earned 1.2 percent last week due to a speculation that central banks will keep interest rates low for a long period of time.
On Monday, the Nasdaq Composite (CCMP) reached its highest level of 1 percent, ever since 2002. Moreover, the Dow Jones Internet Composite Index and the Nasdaq Biotechnology Index also closed at their highest levels on Monday. Although both of these indexes suffered losses in March and April when investors sold off their best performers, they have shown a quick recovery.
At present, the S&P 500 is trading at 17.8 times than the earnings of its companies, observing the greatest value since 2010. According to previous records, the gauge is trading above its average value as compared to 31st July when it was below average. It is expected that the Dow will close above its 50-day average this month.
The measure of S&P options prices, Chicago Board Options Exchange Volatility Index decreased to 11.98 by 2.8 percent. This measure, also known as the VIX, is almost 1 percent down for the current year.
The biggest advantage of the boom of S&P 500 has been to retailers. The Home Depot, Inc. (NYSE:HD) jumped 6 percent to $88.59. According to the Chief Executive of the company, investment in e-commerce rather than opening up more stores at different locations has proved to be a major force behind this boom in sales. The revenue for the second quarter was $23.8 billion. Some of the major reasons behind this record-breaking value were betterment in weather conditions and an increasing interest of people towards renovations due to the increasing prices of houses.
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