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Solid May retail sales show “big spring thaw”

Solid May retail sales show “big spring thaw”

Consumer spending, the missing link in the economic rebound thesis, bounced back in May, as retail sales jumped 1.2%, suggesting that the hoped-for “big spring thaw” has arrived. Heading into today’s retail sales report on last month’s activity at the nation’s retailers, Brad McMillan at Commonwealth Financial Network said a strong retail number was critical to cementing the belief in investors’ minds that the economic contraction in the first three months of the year was weather-related, and that a spring rebound was, in fact, underway.635633042307225295-AP-Consumer-Spending

Well, the 1.2% rise in retail sales in May — which was inline with expectations — and upward revisions to retail sales data for April and March, suggest that consumers are spending again. “U.S. retail sales show big spring thaw,” Paul Ashworth, chief U.S. economist at Capital Economics, told clients in a research report after the retail sales data were announced. The good news is the report was strong on many levels.

“The underlying details of the report are actually a lot stronger than we were expecting,” Ashworth admitted. Wall Street reacted positively to the good news. The Dow Jones industrial average, which rallied 236 points Wednesday to 18,000.40, looks poised to build on those gains today. The Dow was 27 points higher in pre-market trading.

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