While you were sleeping: US holiday sales disappoint
Shares of retailers including Sears and Saks led Wall Street lower as shoppers kept a lid on spending amid concern about the impact of the so-called fiscal cliff as the year-end deadline draws closer.
A measure of American holiday sales showed consumers are reluctant to take advantage of the holiday sales. Data from MasterCard Advisors SpendingPulse showed that holiday-related sales increased a meagre 0.% from October 28 through December 24, down from the 2% climb in 2011.
The Morgan Stanley retail index was last 2.1% weaker. Shares of Sears were down 3.6%, while those of Saks were 3.3% lower.
President Barack Obama is set to return to Washington early Thursday as he attempts to forge an agreement between Democrats and Republicans to prevent about $US600 billion in tax increases and spending cuts from taking effect on January 1.
"The finance centre is still Washington right now," Scott Armiger, a money manager at Christiana Trust in Greenville, Delaware, told Bloomberg News. "With the fiscal cliff, the questions are how bad will the deal be or will they just extend it and let the new Congress address it?"
In afternoon trading in New York, the Dow Jones Industrial Average fell 0.24%, the Standard & Poor's 500 Index dropped 0.61% and the Nasdaq Composite Index shed 0.68%. US stock markets were closed for Christmas Day.
Even so, further evidence of a sustained rebound in the American real estate market came in the form of data showing a better-than-expected increase in home prices in October. The S&P/Case-Shiller index of property values in 20 metropolitan areas rose 4.3% from October 2011. That was the largest 12-month increase since May 2010.
"It is clear that the housing recovery is gathering strength," David Blitzer, chairman of the index committee at Standard & Poor's, said in a statement.
Markets in Europe were closed for the Boxing Day holiday.