US Stock Market Overview – Stocks Close Mixed, Retail Sales Disappoint

US stocks consolidated on Friday with the Dow edging higher and the Nasdaq moving lower. For the week the S&P 500 index edge out a small gain but was unable to reach a new all-time high. The VIX volatility index edged slightly higher but remains relatively depressed. The sectors in the S&P 500 index were mixed, led higher by Energy, while Utilities lagged. Retail Sales came out weaker than expected but were revised higher for prior months. Industrials production continued to rebound but less than the gains experienced in June. Productivity rose to the highest levels since 2009, but labor costs also jumped. Consumer confidence also remained flat.

US Retail Sales Rose Less than Expected

US retail sales rose 1.2% in July, versus the expected increase of 2.3%. Excluding autos, the gain was 1.9%, ahead of the 1.2% estimate. The slowdown in retail sales in July was led by a 1.2% decline in receipts at auto dealerships. That followed a 6.1% acceleration in June

Industrial production, including output at factories, mines, and utilities, rose climbed 3% in July after surging 5.7% in June. Production remains 8.4% below its level in February before the spread of COVID-19 in the United States. Factory output rose 3.4% last month, pulled higher by a 28.3% gain in the production of cars, trucks, and auto parts.

U.S. productivity rose at a 7.3% rate in the Q2 as the number of hours worked fell by nearly half, the biggest drop-off since the government started tracking the data more than 70 years ago. The Labor Department said Friday that output decreased 38.9%, also the biggest decline ever recorded as hours worked fell 43%. The increase in productivity was the largest since 2009. Labor costs also jumped, rising 12.2%.

Consumer Confidence Was Stable

Consumer sentiment in the U.S. remained almost flat in August, according to a University of Michigan. The final reading of the index of consumer sentiment stood at 72.8 in August, up from Julys 72.5. Economists expected the indicator to be at 71.0.