New York stock market rallies as consumer spending recovery prompts investor interest

The New York stock market showed strength for two consecutive trading days. While U.S. retail sales for February fell short of expectations, the recovery trend prompted investors to begin bargain hunting.

On the 17th (Eastern Time), the Dow Jones Industrial Average closed up 353.44 points (0.85%) at 41,841.63 on the New York Stock Exchange (NYSE). The Standard & Poor's (S&P) 500 index rose 36.18 points (0.64%) to close at 5,675.12, while the Nasdaq Composite index finished up 54.58 points (0.31%) at 17,808.66.

According to the U.S. Department of Commerce, retail sales in the U.S. for February were recorded at $722.7 billion, an increase of 0.2% from the previous month after seasonal adjustment. This figure improved from an increase rate of -1.2% in retail sales compared to the previous month in January.

The market focused on the recovery trend. Robert Frick, an economist at the Navy Federal Credit Union (NFCU), noted, "The main factor for consumer expenditure was consumer income, which is increasing at a good pace and showed an impressive leap from January to February."

By sector, stock prices in all sectors, except for discretionary consumer goods, rose. The rising sectors, excluding technology, communication services, and utilities, all jumped by more than 1%. The "Magnificent Seven," referring to seven big-tech corporations, saw only Apple and Microsoft record slight gains, while the others were weak.

Blue-chip stocks and traditional industry-related stocks were on an upward trend. The Dow index, focused on blue-chip stocks, rose with all 27 stocks except for NVIDIA, Amazon, and American Express. Walmart's stock price increased by 2.47%, while retail stocks like Procter & Gamble, Coca-Cola, and McDonald's also showed a strength of around 1%.

The Philadelphia Semiconductor Index, which has a large concentration of stocks related to artificial intelligence (AI) and semiconductors, also rose by 1.42%. TSMC, ASML, Arm, and Micron Technology increased around 2%, while AMD rose 3.59%. Intel also experienced gains due to expectations of improved performance following the appointment of its new chief executive officer.

U.S. President Donald Trump warned that if the Yemeni armed group Houthi rebels continue retaliatory attacks against U.S. forces, he would hold Iran responsible. As geopolitical tensions escalated, the price of West Texas Intermediate (WTI) crude oil increased by 0.6% that day.

According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the probability that the federal funds rate would remain unchanged until the end of June has risen to 33.6%. This is an increase of more than 10 percentage points from 22.9% at the close the previous day. Meanwhile, the probability of a 50 basis point reduction fell from 19.0% to 11.3%.

The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) recorded a decline of 1.25 points (5.78%) to 20.51 from the previous session.