Consumer confidence rise drives up stock market

Stocks rose Tuesday as consumer confidence increased by the most since 2003 and European finance ministers discussed efforts to tame the debt crisis.

The Standard & Poor’s 500 Index rose 0.2 percent to 1,195.19, rallying 3.2 percent in two days. The Dow Jones Industrial Average added 32.62 points, or 0.3 percent, to 11,555.63. The Nasdaq Composite Index retreated 0.5 percent to 2,515.51. The Russell 2000 Index of smaller companies, which gained 4.8 percent Monday, declined 0.3 percent to 696.10.

Stocks extended gains after a report showed that consumer confidence snapped back more than forecast in November as Americans turned less pessimistic on the outlook for jobs.

Federal Reserve Vice Chairman Janet Yellen said the central bank has leeway to spur the U.S. recovery by purchasing more assets. Federal Reserve Bank of Atlanta President Dennis Lockhart said in a separate speech that expanding securities purchases is unlikely to give a sufficient boost to U.S. growth.

“Consumer confidence will be critical to how we weather the next few months,” Bruce McCain, chief investment strategist at the private banking unit of KeyCorp in Cleveland, said in a telephone interview. “Everybody is still on the edge of their chair about whether or not you get the financial crisis solved in Europe.”

 

Experts: Gains in optimism may not last for very long

Americans are beginning to feel more confident about the U.S. economy just as the all-important Christmas shopping season begins. But their optimism may be short-lived.

Consumer confidence surged in November to its highest level since July, a sign that Americans may be more willing to spend, the Conference Board reported Tuesday.

But confidence is still painfully below what is typically seen during a healthy economy. And Americans could start to feel more skittish if the European debt crisis deepens and stokes fears of another recession in the U.S.

“I think this will be a good holiday shopping season,” said Mark Vitner, senior U.S. economist at Wells Fargo. “But the question is, what will happen after that?”

The Conference Board, a private research firm, said its Consumer Confidence Index climbed 15 points in November to 56.0. That is the highest it has been since the 59.2 reading over the summer. That is still well below the level of 90 that indicates an economy on solid footing.

 

‘Cyber Monday’ biggest online shopping day ever

Online shoppers spent record amounts on the day after the Thanksgiving holiday weekend, making it the biggest online shopping day in history.

Online sales rose 22 percent to $1.25 billion on “Cyber Monday,” when retailers ramp up online promotions, according to research firm comScore Inc. That makes it the biggest online shopping day ever, the research firm said. A year ago, “Cyber Monday” sales topped $1 billion for the first time

IBM Benchmark, another company that tracks online sales, reported a 33 percent rise. The average order rose 2.6 percent to $193.24 this year, according to IBM Benchmark. It didn’t give total dollar sales numbers for comparison. The company said about 80 percent of retailers offered online deals.

 

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