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Better-than-expected retail sales data offset discouraging industrial production numbers from Europe, lifting major indices higher on Wednesday. The Dow Jones eked out gains for the ninth consecutive day while the S&P 500 closed around 1% lower than its all-time high. Among the top ten S&P 500 industry groups, consumer discretionary stocks were the biggest gainers while the materials sector was the biggest loser.

The Dow Jones Industrial Average (DJI) edged up 0.04% to close the day at 14,455.28. The S&P 500 rose 0.1% to finish yesterday’s trading session at 1,554.52. The tech-laden Nasdaq Composite Index gained 0.1% to end at 3,245.12. The fear-gauge CBOE Volatility Index (VIX) lost 3.6% to settle at 11.83. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.5 billion shares, well below the daily average of 6.48 billion shares. Advancing stocks outnumbered the decliners. For the 53% that advanced, 44% declined.

The Dow continued to march through positive territory for the ninth consecutive day, making this rally the longest one in the last 16 years. The blue-chip index and the S&P 500 have gained 10.3% and 9%, respectively in 2013 till date. Benchmarks started the trading session in the red following Europe’s weak industrial production numbers but recovered thanks to strong retail sales data.

According to the U.S. Department of Commerce, retail and food services sales increased to $421.4 billion, up 1.1%. Growth in retail sales came in higher than the consensus estimate of 0.5%. Retail trade sales were up 1.3% from the previous month. Non store retail sales grew 15.7% year over year. High retail sales are attributable to an increase in gasoline sales and sales from auto and motor vehicle dealers. Gasoline sales increased 5% in February. On a year over year basis auto and motor vehicle dealers increased 8.8%.

About 70% of economy activity in the U.S. can be attributed to consumer spending. Hence, strong retail data indicates an improving economy. Moreover, positive retail sales figures also indicate consumer spending has not been affected by higher taxes imposed by the government.

Benchmarks were pushed into negative territory in early trading following weak industrial production numbers from Europe. Eurozone’s industrial output dropped 0.4% below the expected level of 0.1%. Industrial production in Germany and France fell 0.4% and 1.2%, respectively. More than a third of the Eurozone’s industrial production is attributable to Germany. Despite poor economic numbers, the European Central Bank (ECB) anticipates a slow recovery in the region in second half of 2013.            

On the earnings front, shares of Express, Inc. (NYSE:EXPR) fell 3.2% after earnings came in below the Street’s expectations. Net sales for the quarter grew 8%. The company guided growth in sales from flat to low single digits for first quarter 2013.

Consumer discretionary stocks were the biggest gainers among the top ten S&P 500 industry groups. The Consumer Discretionary SPDR (XLY) gained 0.6%. Stocks such as the Walt Disney Company (NYSE:DIS),, Inc. (NASDAQ:AMZN), McDonald's Corporation (NYSE:MCD), Time Warner Inc. (NYSE:TWX) and Lowe's Companies, Inc. (NYSE:LOW) increased 0.4%, 0.4%, 0.6%, 0.4% and 0.9%, respectively.

Materials stocks were the biggest losers among the top ten S&P 500 industry groups. The Materials Select Sector SPDR (XLB) lost 0.2%. Stock such as E I Du Pont De Nemours And Co (NYSE:DD), the Dow Chemical Company (NYSE:DOW), FMC Corp (NYSE:FMC), Eastman Chemical Company (NYSE:EMN) and Praxair, Inc. (NYSE:PX) lost 0.2%, 0.1%, 0.2%, 0.2% and 0.1%, respectively.

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