Dow Pointing Up on Economic Reports
The eurozone reported that GDP shrank in the second quarter, but at just 0.2%, the contraction was less severe than economists had anticipated. Growth in Germany and France was stronger than expected and helped to offset the recessionary economies of Spain and Italy. Markets in Europe and Asia reacted to the report by moving upward, and Dow Jones Industrial Average (INDEX: ^DJI) futures gained 0.3%. Asian indexes were also boosted by hopes for a Japanese stimulus after its disappointing GDP report yesterday, and the Hang Seng gained more than 1%.
Home Depot (NYS: HD) shares were up 1% in premarket trading after the home improvement retailer delivered an impressive quarterly report. Profit grew by 12% over the previous year as the company improved margins, and earnings per share of $1.01 topped estimates of $0.97. The retailer also raised its full-year EPS guidance by $0.05 to $2.95, though it maintained revenue projections.
Fellow Dow retailer Wal-Mart (NYS: WMT) was also in the news today after regulators approved its purchase of a controlling stake in Chinese e-commerce company Yihaodian, which will enable it to expand its online presence in China. The Asian power is a huge growth market for the world's largest retailer, with online retail transactions expected to grow five times in the country in just the next two years.
The ever-important retail sales report showed 0.8% growth in July -- the first improvement in four months and a further sign of an improving economy after July's promising employment report. That figure beat analyst estimates of just 0.2% and was strong across all segments.
Producer Price Index data also came out today, with growth of 0.3% on expectations of 0.2%, and the business inventories report should be delivered at 10 a.m. EDT, with a 0.2% increase expected there as well.
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