U.S. Retail Sales Rise at Fastest Pace in Five Months

Arthi Gupta
13 Mar, 2012
New York City

U.S. indexes traded higher after retail sales rose 1.1% in February, the fastest pace in five months. European markets were calm after Greece inches closer to winning the second bailout package. Dell agreed to acquire SonicWALL.

[R]9:35 AM New York – U.S. indexes traded higher after retail sales rose 1.1% in February, the fastest pace in five months. European markets were calm after Greece inches closer to winning the second bailout package. Dell agreed to acquire SonicWALL.[/R]

U.S. indexes gained after retail sales rose at their fastest pace in five months in February and European indexes edged higher after German confidence improved but Greece may face additional spending cuts.

Euro-zone finance ministers approved a second bailout package for Greece in a meeting in Brussels yesterday after Greece completed a debt swap deal with its private creditors last week, a prerequisite for receiving the next tranche of aid worth €130 billion from the troika.

However, Greece awaits the decision of the International Monetary Fund before it gets the first instalment of the second bailout package.

Greece may have to cut its government spending as much as 5.5% of GDP in 2013 and 2014 according to the latest report released by the European Commission report released today. The additional cuts are needed to meet the deficit target set by the international lenders.

The government revenues are lagging the earlier projections set by the government and additional cuts are needed to meet deficit targets and improve government finances.

Separately, the euro area finance ministers urged Spain to take deeper fiscal cuts to bring the deficit below 3% of GDP by 2013.

Asian stocks gained tracking the European markets.

The Bank of Japan decided to expand its loan scheme aimed at supporting economic growth by 2 trillion yen but kept its monetary policy unchanged and left its bond purchase program unrevised.

U.S. Retail Sales Rise

U.S. retail sales rose at a seasonally adjusted level of 1.1% to $407.8 billion in February, following an upwardly revised 0.6% increase in January, according to data released by the U.S. Commerce Department today.

Compared to February of 2011, retail sales rose 6.5%.

Excluding a 1.6% increase in auto sales, retail sales climbed 0.9% in February compared to a 1.1% increase in January.

Earnings Review

Alliant Techsystems Inc. ((ATK)), the aerospace, defense, and commercial products company backed its fiscal 2012 earnings per share view between $7.65 and $7.75 and sales estimated $4.6 billion.

FactSet Research Systems Inc. ((FDS)), the financial data and software integrator reported second quarter revenues rose 12.2% to $199.4 million from $177.6 million the prior-year. Net profit in the quarter climbed 3.3% to $46.7 million or $1.02 per share compared to net profit of $45.3 million or 95 cents per share a year ago.

Urban Outfitters, Inc. ((URBN)), the lifestyle specialty retailer said fourth quarter net sales rose 9% to $730.65 million from $668.39 million in the same quarter last year. Net income in the quarter plunged 48% to $39.3 million or 27 cents per diluted share compared to net income of $75.2 million or 45 cents per share for the year-ago quarter.

For the year ended January 31, 2012, total net sales increased 9% to $2.5 billion from $2.3 billion in the prior year. Net income for the year fell 32% to $185.25 million or $1.19 per diluted share compared to net income of $272.96 million or $1.60 a share a year ago.