US stocks rise solidly in Black Friday retail rush
Nov 23, 2012 at 10:41 AM
U.S. stocks rose solidly on Black Friday, the unofficial start of the holiday shopping season.
The Dow Jones industrial average was up 68 points at 12,904 in the first half-hour of trading. The Standard & Poor's 500 index rose seven to 1,398. The Nasdaq composite index gained 18 to 2,944.
Retail is a key driver of the nation's economy. Consumer spending accounts for about 70 percent of U.S. economic activity. November and December, which can account for as much as 40 percent of a retailer's annual revenue, are crucial for stores.
The Friday after Thanksgiving is known as Black Friday because it begins the period in which many retailers turn profitable for the year. Traders will be looking for signs about how enthusiastically Americans are spending. That could reflect the momentum of the economic recovery.
Trading volume was light, with many investors away for an extended weekend after Thanksgiving. The market will close early, at 1 p.m. EST.
In an effort to lure shoppers this year, many stores were opening earlier than ever. Target and Toys R Us opened on Thanksgiving evening. Retailers are also trying to draw shoppers with free layaway and shipping, by matching prices of online rivals and by beefing up their mobile shopping apps.
European indexes added to earlier gains after Wall Street opened. The FTSE 100 index of leading British shares rose 0.4 percent, Germany's DAX 0.6 percent and France's CAC-40 0.5 percent.
Investors are monitoring developments in Brussels, where European Union leaders are trying to agree on a $1.25 trillion long-term spending plan for the 27-nation bloc. Markets expect that another meeting will be needed for an agreement.
Among the stocks making big moves:
— Research in Motion Ltd. jumped on growing optimism for an earlier-than-expected launch of its delayed BlackBerry 10 smartphone. A senior executive from the Canadian company said earlier this month that Research In Motion, or RIM, will release the latest version of its smartphone "not long after" a Jan. 30 event. One analyst saw that as an indication that the products are to be unveiled in February. U.S.-traded shares of RIM rose $1.20, or 12 percent, to $11.46.
— MAP Pharmaceuticals spiked after the company announced that the Food and Drug Administration will review its experimental migraine drug Levadex. The stock rose $2.41, or 19 percent, to $15.23.
— KIT Digital Inc. lost more than half its value after the company's former chief executive accused it of blaming prior management for its financial problems. Two days earlier, KIT said it would restate its financial results because of accounting errors. The stock lost $1.17, or 57 percent to 90 cents.